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Eurointelligence Daily Briefing: Bundestag to torpedo a key element of the ESM deal
Budget committee says automatic capital rule of the ESM both unacceptable and unconstitutional; wants to subject each capital increase to a vote in the Bundestag (which would probably impair the AAA-rating of the ESM; statement comes after German Court of Auditors handed out a ruling saying that Merkel understated the amounted of capital Germany is likely to provide, as it underestimates the possibility that other guarantors might not pay up; S&P says ESM is not going to impair the creditworthiness of its guarantors; Portuguese banks reduce ECB borrowings; polls suggest a close outcome of Finnish elections; AIB considers debt forgiveness for Irish mortgage holders; Troika frustrated about Greek authorities' failures on taxes and customs; 30 NGOs create a "Finance Watch" lobby group to counter the lobbying strength of the financial sector; the Netherlands threatens to block Iceland's bid to join the EU; Wolfgang Münchau argues that the lack of  bond purchasing powers of the EFSF/ESM makes any voluntary debt restructuring options impossible; Lorenzo Bini-Smaghi, meanwhile, argues that it is fair for Irish taxpayers to shoulder the burden, as they created a financial centre based on lax financial regulation and low corporate taxes.
(Google link)

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Wed Apr 13th, 2011 at 04:52:32 AM EST

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