Sunday, October 20, 2013

What does the Soros on the outcome of the euro crisis ? Or why Merkel wants Eurobonds ?

What does the Soros on the outcome of the euro crisis ?
Or why Merkel wants Eurobonds ?

Can you believe Soros ?
I do not know , because as he admits: "I am proud that I am a successful speculator . "
Maybe because he was "the man who blew the Bank of England , and during the Asian financial crisis , in similar circumstances, speculation in Malaysian currency unit - ringdzhit slow the progress of Malaysia for two years .
Government bonds of euro area Member States are risk-free . Commercial banks could hold them without taking additional reserves , the ECB took them on a par with the same conditions in which providing their discounts. This created a perverse incentive for banks to buy weaker sovereign debt in order to benefit from a few basis points , since the differential in interest rates is actually closer to zero.
But the convergence of interest rates caused the deviation. Weaker states enjoyed a boom in the real estate sector , consumption and investment, while Germany , tasked to carry the fiscal burden of reunification , had to implement austerity measures and undertake structural reforms. This is the origin of the crisis in Europe, but this time it was not recognized. Even today, it still can not be understood.
The conversion of all outstanding government bonds Eurobonds far not require any transfer payments and each country will be responsible for servicing their own debt . They will only issue Eurobonds to refinance old debts . Any additional loan will be for their account, and that markets can impose penalties for excessive borrowing .
Eurobonds would significantly reduce the cost of over-indebted countries will achieve much to restore equity in the eurozone.
Germany's credit rating will not be jeopardized because Eurobonds will be compared to bonds issued by other major countries.
Eurobonds will not heal differences in competitiveness. Euro area countries will still have to make their own structural reforms. But they can make up a major weakness of the euro. All of the alternatives are worse - they either include transfer payments , or create inequality , or both. And in terms of opposition to Merkel - they Eurobond is out of the question.

Germany a little closer to the coalition. Social Democrats waive taxes for the wealthiest .

Thistle . Herb in folk medicine.

Grigor Dimitrov won the match with David Ferrer first title in the ATP tournament in Stockholm.



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