TIMES ONLINE: Shocked European ministers are preparing for emergency talks to shore up the euro after markets fell in reaction to panic measures in Germany.
Angela Merkel stunned EU capitals by warning that the euro was in danger and triggered fears of a fresh financial meltdown by announcing a ban on risky trading practices by speculators. The German Chancellor’s actions opened up new cracks in the single currency, drawing sharp criticism from France and prompting Brussels to issue an appeal for unity.
Shares in London plunged by nearly 3 per cent, with similar falls in Paris, Berlin and Madrid. The euro plummeted to a new low against the dollar before making a slight recovery.
European finance ministers, who have just hammered out a massive rescue plan for Greece, will hear controversial calls from Germany at a meeting tomorrow for changes to the Lisbon treaty to give Brussels powers to co-ordinate national budgets.
Ms Merkel believes that the EU should have stronger powers to organise the “orderly insolvency” of countries such as Greece that set giveaway budgets with no means of paying for them. After announcing a ban on speculative share trading in Germany’s top financial institutions and the bonds of eurozone countries until next March, she warned: “This challenge is existential and we have to rise to it. The euro is in danger. If we don’t deal with this danger, then the consequences for us in Europe are incalculable . . . If the euro fails, then Europe fails.” Read on and comment >>> David Charter, Berlin | Thursday, May 20, 2010
