THE EUROZONE IS IN BAD NEED OF AN UNDERTAKER
—The EUâ€™s Franco-German “Directoire” and the European Central Bank have between them ruled out all plausible solutions to the eurozoneâ€™s debt crisis.—
By Ambrose Evans-Pritchard, International Business Editor 7:21PM GMT 12 Dec 2010
There will be no Eurobond, no increases in the EUâ€™s â‚¬440bn (Â£368bn) rescue fund, and no mass purchases of Spanish and Italian bonds by the ECB. Nothing. The system is politically and constitutionally paralysed. Spain and Portugal will be left nakedly exposed before their funding crunch in January.
It is entirely predictable that Angela Merkel and Nicolas Sarkozy would move so quickly to shoot down last weekâ€™s Eurobond proposal, issuing pre-emptive warning before this weekâ€™s EU summit that they will not accept â€œa bundling together of all Europeâ€™s debtsâ€.