20th EU Crisis Summit - Solutions or more Fudge ?

[C. Flower]

Merkel is not as stupid as it may appear, in pursuing the Compact goals, even though they will not solve the There is not enough real value being produced in Europe to maintain profit rates and the lifestyles of the rich and powerful. Making fewer people work harder to produce more for less money is the only way that they can restore their profits. It "worked" in Germany, after all... Except in Germany, it worked as Germany was able to sell its goods cheaper than other EU countries. When wages are generally slashed across Europe, then the advantage is gone, and also a portion of the people who were buying from Germany will no longer be able to afford to.

There is a connection between the banks crisis, and the underlying crisis of over-production and lack of profitability, although it doesn't smack one in the face, and has to be dug for.

[DCon]

Merkel is not as stupid as it may appear, in pursuing the Compact goals, even though they will not solve the There is not enough real value being produced in Europe to maintain profit rates and the lifestyles of the rich and powerful. Making fewer people work harder to produce more for less money is the only way that they can restore their profits. It "worked" in Germany, after all... Except in Germany, it worked as Germany was able to sell its goods cheaper than other EU countries. When wages are generally slashed across Europe, then the advantage is gone, and also a portion of the people who were buying from Germany will no longer be able to afford to.

There is a connection between the banks crisis, and the underlying crisis of over-production and lack of profitability, although it doesn't smack one in the face, and has to be dug for.

the can will be kicked to the end of 2012 (at least)

EU leaders to ask top four EU officials to develop a specific, time-bound roadmap for genuine economic and monetary union by year-end, with an interim report in October
Banking union should cover all Eu countries, but with difference for euro and non-euro members

http://www.forexlive.com/blog/2012/0...ntil-year-end/

[DCon]

Although...

SPD reported in an interview Germany may need a referendum on transferring sovereignty to the European level . He states Europe needs the decision-making capacities of the European Parliament to ensure the legitimacy of a future political union and the single currency.

http://www.forexlive.com/blog/2012/0...dum-on-europe/

[DCon]

From the FT

a Dutch-German alliance is likely to block any exotic new measures to solve the issue of South European indebtedness. Existing tools will have to do, seems to be the message.

Martin Schulz, the president of the European parliament, told ZDF television of Germany: “I think we should stop talking about eurobonds now because, with the German government’s “no,” with this definitive “no” from Mrs. Merkel, eurobonds are now a non-issue.
“I personally continue to see it as a good solution, a sensible one, but there is no sense in conducting theoretical debates when the house is on fire.’

http://blogs.ft.com/the-world/2012/0...#axzz1z6X99fsV

[DCon]

the unelected leaders of the EU are having a presser

http://video.consilium.europa.eu/

[ang]

That much talked about report - TOWARDS A GENUINE ECONOMIC AND MONETARY UNION -

The report proposes a vision for a stable and prosperous EMU based on four essential
building blocks:
§ An integrated financial framework to ensure financial stability in particular in the euro
area and minimise the cost of bank failures to European citizens. Such a framework
elevates responsibility for supervision to the European level, and provides for common
mechanisms to resolve banks and guarantee customer deposits.
§ An integrated budgetary framework to ensure sound fiscal policy making at the
national and European levels, encompassing coordination, joint decision-making,
greater enforcement and commensurate steps towards common debt issuance. This
framework could include also different forms of fiscal solidarity.
§ An integrated economic policy framework which has sufficient mechanisms to ensure
that national and European policies are in place that promote sustainable growth,
employment and competitiveness, and are compatible with the smooth functioning of
EMU.
§ Ensuring the necessary democratic legitimacy and accountability of decision-making
within the EMU, based on the joint exercise of sovereignty for common policies and
solidarity.
These four building blocks offer a coherent and complete architecture that will have to be
put in place over the next decade. All four elements are necessary for long-term stability
and prosperity in the EMU and will require a lot of further work, including possible
changes to the EU treaties at some point in time.

http://www.consilium.europa.eu/uedoc.../ec/131201.pdf

[DCon]

120 BN announcement made but the Russian sees through it

Constantin Gurdgiev ‏@GTCost

@LISwires Nope - 60bn EBI (on 10bn capital inject), plus 60bn planting pesos in the Field of Dreams... water.. Pinocchio @euHvR | @zerohedge

https://twitter.com/#!/GTCost

[C. Flower]

That much talked about report - TOWARDS A GENUINE ECONOMIC AND MONETARY UNION -



http://www.consilium.europa.eu/uedoc.../ec/131201.pdf

Discussed here too -

http://www.politicalworld.org/showth...oso#post257847

[C. Flower]

Lucinda has woken up. She has found things in common with the Spanish and Italians, "on the margins of the conference". Do you think they found a bar to watch the match ?

Italy 2- Germany 1

[ang]

Lucinda has woken up. She has found things in common with the Spanish and Italians, "on the margins of the conference". Do you think they found a bar to watch the match ?

Italy 2- Germany 1

Good for Lucinda waking up ! Long may it last.

Angela didn't seem so happy about the result -

AP: Angela Merkel cancelled the earlier announced press conference, as soon as Ballotelli scored the second goal.

Italy are also refusing to sign growth pact until bond buying deal is reached -Source - CNBC

[PaddyJoe]

There's actually very little new about this famous 'growth' pact:

The EU summit is congratulating itself on its new growth pact for Europe. The 130 billion euros, however, are coming from existing funds and are not a new economic stimulus package.
For years, the European Union has regularly discussed strategies for economic growth at its summit meetings. The EU's existing regional fund, totaling some 30 billion euros a year, is already designed to generate growth and jobs, says EU Commissioner for Regional Policy, Johannes Hahn.

http://www.dw.de/dw/article/0,,16059177,00.html

[DCon]

Italy playing hard to get

Italy demands bond buying deal in exchange for growth pact

http://www.forexlive.com/blog/2012/0...r-growth-pact/

[ang]

France joining Italian and Spanish rebels now -

Another official said that France, the strongest backer of the growth pact, had also raised concerns about a deal in part because it does not want stricter measures on budget restraint to be introduced as soon as planned.

http://www.reuters.com/article/2012/...8HSMIC20120628

[C. Flower]

the can will be kicked to the end of 2012 (at least)


http://www.forexlive.com/blog/2012/0...ntil-year-end/

The markets may not want to wait.

And there is little probability that they would win the necessary referenda. It is really time for the likes of Syriza to put forward an alternative proposal for Europe.

Lucinda is on Prime Time talking about agreement on a growth pact. Her nose is sticking right out into my sitting room.

[DCon]

El Presidente detailing the fudge

What we have already agreed today concerns first of all the growth and jobs agenda, and
here the key element is that we will boost the financing of the economy by mobilising
around 120 billion euro for immediate growth measures.
A 10 billion euro increase of the capital of the European Investment Bank will increase the
Bank's overall lending capacity by 60 billion euro. This money must flow across Europe,
not least to the most vulnerable countries, and help companies grow themselves out of the
crisis.
The other 60 billion euro comes first from the reallocation of unused structural funds (55
billion), in particular for small and medium enterprises and youth employment, and second
from the pilot phase of Project Bonds that should be launched this summer and will go to
key initiatives in energy, transport and broad-band infrastructure (almost 5 billion).
We have prepared the ground on how to stimulate growth earlier this year. It is not just
about injecting money. Growth is the overriding concern in every aspect of our work -- be
it improving the single market, tackling unemployment or promoting trade and innovation.
The growth agenda is a sign of our unrelenting commitment. It brings together all the
concrete measures that we will swiftly take, in each Member State and together as a Union.

http://ue.eu.int/uedocs/cms_data/doc.../ec/131358.pdf