Angela Merkel dashes Greek hopes of rescue bid

[FourScore]

Source: guardian.co.uk

Angela Merkel, the German chancellor, mounted stiff resistance tonight to any swift bailout of Greece, as a rift opened up between European capitals over how best to tackle the risks posed to the euro.

Despite a show of Franco-German unity on the crisis and the first statement from EU leaders pledging to safeguard the currency's stability, hopes on the markets of a German-led rescue plan to shore up Greece's critical public finances were dashed by Merkel, who repeatedly emphasised that Athens would need to put its own house in order and brushed aside all questions of financial support.

"Germany is stepping totally on the brakes on financial assistance," said a senior EU diplomat. "On legal grounds, on constitutional grounds and on principle." Another senior diplomat said of the Germans: "They're not waving their chequebooks."

An EU summit of 27 government chiefs in Brussels was the first opportunity to tackle the Greek crisis and also send a strong message to the financial markets, which have been betting against the euro for the last week...

Read more: http://www.guardian.co.uk/theguardian/2010/feb/11/germany-greece-merkel-bailout-euro

[Rapier09]

1. Greece doesn't belong in the EU or the eurozone

They can take a hike.

[JVS]

6. The only country that belongs in the Eurozone is Germany, and possibly France.

The rest need the ability to have currency devaluation.

[MercutioATC]

2. Seeing as bailing out Greece would violate the EU charter...

...Merkel is right.

However, the PIIGS will likely all come home to roost if Greece falls. It's going to be interesting.

[Mojorabbit]

4. I think it will be very interesting

I wonder what the weekend will bring. It could start some dominoes falling in Portugal, Spain, etc if money starts leaving those countries like it did Greece.

[DFW]

3. The Germans are running a deficit as it is

It's nowhere as large as that of Greece, but asking the German taxpayers to bail out Greece would spark a serious
taxpayer revolt, not to mention encouraging Portugal to come, hat in hand, asking for the same treatment. German
taxpayers have pretty much paid for half the highways in Portugal as it is. During a time when all sorts of German
tax cheats are being brought to light, the last thing the German government wants is a sudden surge of sympathy
and justification for the tax dodgers. Greece and Portugal will have to get their own houses in order this time.

[JVS]

5. Germany's influence on how monetary policy in the Eurozone is conducted is very destructive.

[leftynyc]

7. I'm curious

Anybody know how much it cost Germany to incorporate East Germany into their economy? How much did the other EU countries contribute to that?

[grantcart]

8. It was devestating to Germany

Not only did they basically have to pay out hundreds of billions to subsidize East Germans until they moved west and got integrated into the system Germany also wrote huge checks for the other failed Communist countries.

So worried was Germany about millions of starving Russians walking to Germany for food the government paid huge sums to cull Germany dairy and beef herds and sent large amounts of beef to Russia.

Other countries also were devistated including Finland whose manufacturers had enjoyed huge margins with their exclusive entry into the Soviet Union giving them a monopoly of sending European quality consumer goods into the USSR. I visited some of those factories and they were the size of small cities.