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Posts tagged ‘European FinancialStability Facility’

German Court Makes EU Survival More Difficult

by Staff Report of the Daily Bell.

Free-Market Analysis: As expected, the German constitutional court ruled yesterday that Chancellor Angela Merkel‘s bailouts of Europe were constitutional but that a Parliamentary subcommittee needs to approve Merkel’s moves in the future.

The Treaty clearly states such bailouts are unconstitutional but in such instances, justices can apparently determine unstated and invisible penumbras of meaning (as the US Supreme Court has done in the past) that provide a different context and justify almost any interpretation.

The decision was in line with what many had expected; really, anything else would have precipitated an immediate political and economic firestorm, even though what Merkel has been arranging  on a regular basis with France’s Nikolas Sarkozy is questionable in the extreme. (And Germans WILL ask questions, and are beginning to do so.)

Most recently, Merkel and Sarkozy have agreed to a closer political-economic union to begin in a few years’ time. It is one that may necessitate changes to the EU‘s operating treaty, though. Why Merkel believes she can commit her fellow Germans to becoming part of a larger French-German entity is somewhat unclear, especially since her own party keeps losing elections as a result of her integrationist policies.

read full article at source: http://www.thedailybell.com/2899/German-Court-Makes-EU-Survival-More-Difficult

German Court Set to Trip Up EU?????

This image shows Angela Merkel who is the Chan...

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DB Briefs: German Court Set to Trip Up EU? / China’s Leaders Attempt to Gag Internet, but Problems are Fundamental/ Atlantic Questions Work Habits of US Leaders

Monday, September 05, 2011 – by Staff Report

German Court Set to Trip Up EU? …

German court to insist on bail-out reforms … The German Constitutional Court is set to demand that the German government does more to ensure “democratic legitimacy” for its support for European wide bail-outs in its long-awaited judgment on the legality of the multi-million bail-out of debtor nations. Chancellor Angela Merkel has faced criticism for not seeking fresh democratic mandates for the millions of euros the German government has provided in support for the eurozone’s struggling nations such as Greece and Ireland …  Leading European experts have said that, although the court is unlikely to throw out the bail-out policy, which would cause chaos across the eurozone, it is likely to set conditions on continuing German support for the policy. Matt Persson, of the think tank Open Europe, said: “The Court will almost certainly approve the bail-outs, possibly citing as a reason that monetary stability is a legally protected interest.. However, the Court is also susceptible to public opinion and, in order to guard its reputation, could well demand more influence for the German parliament and lay down additional constitutional red lines in return for approving the bail-outs.” It could also make moves towards fiscal union in the eurozone even more complicated, he said.  – UK Telegraph

full article at source:http://www.thedailybell.com/2882/DB-Briefs-German-Court-Set-to-Trip-Up-EU-Chinas-Leaders-Attempt-to-Gag-Internet-but-Problems-Are-Fundamental-Atlantic-Questions-Work-Habits-of-US-Leaders

Central Bank Governor defends bailout role

The Governor of the Central Bank Patrick Honohan has defended his role in the European
Union-International Monetary Fund deal negotiated last November.He said he has no regrets about going on RTÉ Radio to tell the Irish people and the wider world what was going on, as he considered it necessary to avoid a potential crisis. He
said over the previous days there had been intense negotiations involving a lot of people.

But he said there was a sense in markets and in European political circles that
something was stalling in the process, and that something very serious was about to happen.There was concern in European political circles, including in the European Central
Bank, about the negotiations, and there was a fear of a meltdown.

He said he was trying to reassure people behind the scenes that the talks were
going ahead. Prof Honohan said he believed that he was the only person who was going to tell people what was happening, and that he had a responsibility to do that.

The Central Bank Governor said his only personal regret was that he wrong-footed
the late Brian Lenihan, whom he said could have told people the day before the
governor’s intervention, but it was Mr Lenihan’s choice not to do so.

He said the deal negotiated was not a bad one, but he felt a number of opportunities for a better deal were missed because it was done quickly.

The noted problem was the high interest rates charged by the European Financial
Stability Facility, a situation that has now been rectified.

He also pointed to last week’s call by IMF head Christine Lagarde for the EFSF to
use funds to directly capitalise banks, rather than lending on to states to do the same.

He said that in this case it would be the EFSF rather than the Irish taxpayer who
owned 99.8% of AIB and big stakes in all the other banks. He said a scheme of that kind was something he had in mind at the time, that might have been worked up into a detailed scheme if there had been more time.

source: http://www.rte.ie/news/2011/0902/banks.html

Comment:

This Man has changed the his tune so many times he is in effect a poacher turned gamekeeper As far as I am concerned he is a disgrace He presented the
first bank stressed tests to the nation and they subsequently proved to be an
absolute fraud just like the second one and the latest one will prove to be
just as fraudulent. Nothing he says has an ounce of credibility ,he should be
in Jail along with the rest of the gangsters who gave away our independence!

Why the European Union Could be Dead Within a Week

By: Money_Morning

Shah Gilani writes: The clock may be ticking on the future of the European Union (EU).

After being shaken to its core by the sovereign debt crisis, the entire Eurozone now runs the risk of blowing up within a week.Germany‘s highest court, the German Federal Constitutional Court, on Sept. 7 rules on the legality of German participation in the euro rescue fund that was established to bail out Greece.

If the court rules that Berlin’s commitment to the European Financial
Stability Facility (EFSF) goes against EU law, or worse, against the German
constitution, the entire Eurozone could collapse.

Think of the Eurozone as a minefield full of bombs that have long lay dormant, but are all still very active. Now, Germany’s court ruling – itself a single bomb timed to go off next Wednesday – could ignite a massive chain reaction.

Germany: The Eurozone’s Bomb Squad

Peripheral Eurozone countries like Portugal, Ireland, Greece, Spain, and Italy
(the PIIGS) are in serious trouble and European banks face monumental liquidity
and balance sheet issues.So far, only Germany’s singular fiscal conservativism and economic strength have kept the EU from self-destructing. But now the Eurozone’s only legitimate bomb squad may be hanging up its lead-suits, pliers, and contagion containers.What’s at issue for the Constitutional Court is whether Berlin broke the
EU’s Maastricht Treaty, which unequivocally stipulates that member states
cannot assume each other’s debts. And, more germane to German citizens and the
center-right coalition government, will be the Court’s ruling on whether German
Chancellor Angela Merkel‘s decision to fund the bailout facility circumvented
constitutional requirements to put such fiscal matters before the German parliament and while the court isn’t ruling directly on the EU’s currency – or Merkel’s support of it – the decisions rendered will have consequences for the euro’s future and by extension, the EU as a whole.

read full article at source:http://www.marketoracle.co.uk/Article30218.html

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