The bailouts have damaged the basis of Europe’s currency union?
Yes, but look who’s talking:
Bundesbank President Axel Weber has dished out €338 billion!!!
The bankster bailouts bankrupted several countries, that already needed bailouts themselves to survive, other countries will need them later on.
Spain is already too big to bail out. Then the next stage is a currency crisis and a currency reform.
You have just witnessed the biggest bank robbery and the biggest looting of entire nations (incl. the US) in history, perfectly planned by the elitists.
DUESSELDORF, Germany (Dow Jones)–The financial rescues of Greece and Ireland have damaged the foundations of Europe’s currency union, Deutsche Bundesbank President Axel Weber said Monday.
In a speech to an audience of academics and business representatives, Weber said it was essential not to let the deals that have been made to keep financial stability in the euro zone become the norm.
“We have to strengthen the foundations again,” he said. He highlighted the risk that highly indebted countries in the euro zone might try to put pressure on the European Central Bank not to raise interest rates, as this would raise the cost of their debt servicing to unsustainable levels. Weber has indicated he has no desire to be subjected to that kind of pressure and has said he will step down from the Bundesbank at the end of April, instead of allowing himself to be put forward as successor to Jean-Claude Trichet, whose term at the head of the ECB ends in October.
Mario Draghi, the man who has emerged as the likeliest candidate to succeed Jean-Claude Trichet since Weber’s announcement, is currently central bank head in Italy, a country with one of the highest debt levels in the euro zone, at over 115% of gross domestic product.
Returning to a theme already made earlier Monday in the Bundesbank’s monthly report for February, Weber warned against measures that buy time in the short term but which encourage moral hazard in the longer term by creating false incentives for states.
“All too often, short-term, ad hoc decisions are taken that are counter-productive in the medium term,” Weber said.
He included in this category the proposal now circulating among euro-zone governments to allow the European Financial Stability Facility to buy the bonds of financially troubled states on the open market, or from the ECB. The ECB has spent over 77 billion euros ($105 billion) to support the government debt markets of Greece, Ireland and, most recently, Portugal.
“We are an independent central bank,” Weber said. “If we stop buying bonds, it isn’t so that someone else jumps into the breach.”
“The European Union mustn’t become a transfer union,” Weber said, arguing that the tendency of all such measures was to put extra burdens on the taxpayers of other countries in the euro zone.
Weber looked forward to the creation of the European Stability Mechanism, which is due to succeed the European Financial Stability Facility in 2013, and which he said would do more to ensure that private creditors carry their share of the burden of any future rescues.
Weber said that the discipline of market forces on governments could be increased by incorporating into all bonds issued after 2013 clauses that automatically put back the repayment date if the issuer gets into trouble.
“This would put the risk back where it belongs, namely in the hands of the bond-holder,” Weber said.
DOW JONES NEWSWIRES
FEBRUARY 21, 2011, 1:26 P.M. ET
Source: The Walls Street Journal