Skip to comments.EU: Angela Merkel and Francois Hollande pledge to back euro
Posted on 07/27/2012 5:44:37 PM PDT by bruinbirdman
Angela Merkel and François Hollande pledged on Friday "to do everything to protect" the European Union's single currency, papering over deep divisions between them over how to tackle the Spanish and Italian debt crisis.
The German chancellor and French president issued a joint statement following a crisis telephone call echoing Mario Draghi's promise on Thursday that the European Central Bank would do whatever it took to save the euro.
"France and Germany are fundamentally tied to the integrity of the euro area," they said in the statement.
"They are determined to do everything to protect it.
"Member states, like the European institutions, must fulfil their obligations to this end according to their prerogatives."
Markets rose on Friday afternoon as the Franco-German signal was interpreted as giving a green light for ECB to resume buying Italian and Spanish bonds.
The call for European institutions to act is backed up by a promise of "rapid implementation" of a controversial EU summit decision last month to use euro bail-out funds to help banks and to insure Spanish or Italian bonds.
Germany has unsettled the markets and angered France and Spain over the past two weeks by showing reluctance to implement the decision because of strong domestic opposition to the eurozone directly assuming debts run up by national banks or governments.
In an acknowledgement of the growing backlash over the rising costs of saving the euro, Germany's powerful Bundesbank warned the ECB on Friday not to "blur the line between monetary and fiscal policy" by intervening on bond markets to bring down the cost of Spanish and Italian borrowing next week.
"The mechanism of bond purchases is problematic because it sets the wrong incentives," said a Bundesbank spokesman.
Bloomberg reported on Friday night that Mr Draghi will hold talks with
(Excerpt) Read more at telegraph.co.uk ...
Pay no attention to the Epic Fail behind the curtain.
Statists always double down for more statism when previous attempts fail. Every socialist government on the planet is in over its head. None of them are in the black or even close, and France and Germany are no exceptions. They ALL spend money they don’t have to prop others that spend what they don’t have. Where it stops, no one knows, but I can’t imagine it ends well.
Captioning the photo:
Hollande: “I believe it is raining’
Merkel: “Why, yes, but why is it yellow?”
Why is Hollande in the same picture as Merkel? What exactly is France going to back the Euro with other than a pledge of Germany’s money? I always smile when I see the French President in the same picture as the German Chancellor as if there is some sort of economic equivalency between the 2 nations, France is closer to Italy and Spain than it is to Germany.And now with Hollande the Socialist in charge it is just a matter of time when France will hit rock bottom and be looking for a loan from Greece.