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2011-06-24

Nej till EBU

ESM för EMU ett steg vidare mot EBU, European Bond Union, mot slutmålet EFS, Europas Förenta Stater.


Europas Förenta Stater kan kanske vara något att sträva mot, i sinom tid, när Europas folk känner sig, i första hand, som européer, och inte som tyskar, engelsmän och fransmän och greker och portugiser eller spanjorer.


Om försöket görs för tidigt kommer folken i Europas länder att revoltera.


Tyskar och greker har väl inte tyckt så illa om varandra sedan 1940-talet, så mycket om talet om hur bra EMU skulle vara för freden...


ESM är ett steg på vägen närmst mot EBU där delstaterna inom Euroland ger ut obligationer som garanteras av inte landet i fråga, t ex Grekland, utan garanteras av Euroländerna tillsammans.


Sverige bör inte gå med i EBU och för att förhindra det är det viktigt att vi just nu undviker att gå med i ESM.




The EFSF is now to be replaced by the "permanent" European Stability Mechanism ("ESM") which will have lending capacity of Euro 500 billion.
Satyajit Das, Eurointelligence,  24 June 2011


Executed with Northern European creativity, charm, flexibility and humility and Mediterranean organisation, leadership diligence and appetite for hard work, the European rescue plan – "the grand compact" - is failing.


Greek interest rates of around 18% (for 10 years) and 30% (for 2 years), Irish and Portuguese rates of over 12-13% (for 2 years) and around 10% (for 10 years)


The EU response has relied on two mechanisms – the ECB and the European Financial Stability Fund ("EFSF").


The ECB has financed the beleaguered countries by buying their bonds in the secondary market (around Euro 75 billion) and also by financing banks, against collateral of increasingly questionable quality such as Greek government bonds.


The "temporary" EFSF due to terminate in 2013 proved poorly designed. 


The Euro 500 billion fund is theoretically backed by Euro 80 billion in cash and Euro 620 billion in guarantees from Euro-zone members.


The reliance on Euro-zone members guaranteeing each other is problematic. For example, every Euro 100 billion provided by the ESM increases Italy’s potential liabilities by Euro 18 billion.


Non-common currency EU members /RE: like Sweden/  may not be part of the new structure. The UK has indicated that it will not be part of the ESM.


Access to the ESM funding requires unanimous agreement amongst the Euro-zone members.


The terms of the ESM, especially the subordination of existing lenders to bailout funding and the mandatory Cas will increasingly force lenders and investors to avoid funding vulnerable countries.


In effect, this will ensure that the peripheral economies becoming increasingly dependent on EU support, triggering the negative spiral described.


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