Thursday 24 November 2011

Shock as €6bn German Bond Sale Ends in Failure

THE GUARDIAN: European commission president says Brussels must be able to impose tax and spending controls on member states

Global financial markets prepared for the euro's endgame after the sovereign debt crisis spread to Germany, the "stability anchor" of the single currency, and investors shunned its government bonds.

Europe's biggest economy suffered what analysts called a "complete and utter disaster" as it managed to sell only two-thirds of its 10-year bonds at auction. "It's a vote of no confidence in the entire eurozone," one said.

Stock markets slumped, the euro fell to a recent low and France came under renewed pressure after it emerged it could be forced by Belgium to pump more emergency aid into rescued lender Dexia. Both countries were forced to deny reports that a €90bn restructuring plan for Dexia was being renegotiated.

Fears of a new credit crunch were heightened by reported problems at Belgian lender KBC and a €10bn (£8.6bn) requirement for fresh capital at Germany's bigger banks.

Paris was again warned – by the Fitch agency – that the country could soon lose its triple A credit rating if the debt crisis and economic downturn deepened. Yields on key eurozone sovereign bonds, including Germany's, rose in tandem, with Italy's back above 7% in late afternoon trading.

Amid widespread investor anxiety about the future, the European commission president, José Manuel Barroso, admitted that it would be impossible to save the euro unless eurozone countries agreed to strict controls from Brussels and the European Central Bank in their tax-and-spend policies. » | David Gow | Wednesday, November 23, 2011

WELT ONLINE: Barroso fühlt sich von der Bundeskanzlerin verraten: Der EU-Kommissionspräsident und die Bundeskanzlerin sind tief zerstritten. Während Merkel für langfristige Lösungen plädiert, ist Barroso für schnelle Hilfen. ¶ Ein friedlicher Tag in Brüssel. Seit Tagen wartet Europa auf diese Pressekonferenz, auf die Kommissionschef José Manuel Barroso sich gerade vorbereitet. Dann kommt ein Bote in sein Büro, er hat schlechte Nachrichten. Die deutsche Kanzlerin habe Barrosos Vorschläge zur Einführung von Gemeinschaftsanleihen, den sogenannten Euro-Bonds, im Bundestag als „unpassend“ und „bekümmerlich“ bezeichnet. Kurz bevor Barroso seine Pläne offiziell vorstellen würde. ¶ Das war am Mittwoch, und dieser Vorfall markiert den endgültigen Bruch in einer Beziehung, die in den vergangenen Jahren viele Höhen und einige Tiefen erfahren hat, aber niemals zerrüttet war. „Chère Angela“, „lieber José Manuel“ – das ist jetzt vorbei. » | J. Dams, C. B. Schiltz und K. Seibel | Donnerstag 24. November 2011