What's the problem? Finland wants the new permanent bailout mechanism, the ESM, to make unanimous decisions "special" majority that Mer-Kozy agreed to. The Netherlands has the Finns back on this one, they DON'T want to be subject to bailouts that they didn't approve and have no recourse, calling it simply and truthfully, 'an erosion of democracy". How would you like it if your government was bailing out other countries with your money and you didn't give your consent? Ooops, well if you live in the US you probably are use to that.
Th Irish, who created the Celtic Lion on the basis of their corporate tax system disapproves of the convergence of the corporate tax base.
Since Finland and Holland are two of the bigger contributors to the ESM fund, the fact that they don't like what they are hearing is significant and the whole summit has been described as in 'tatters". Again, just like with the leveraged EFSF, don't these countries talk to each other and work this stuff out BEFORE the summit that the whole world and especially the S&P ratings agency are closely watching?
It really seems like amateur hour AGAIN. IT's just really hard to believe.
In any case, it gets better... Here are the latest headlines:
- EU LEADERS AGREE THEY WILL REEXAMINE CEILING OF ESM BAILOUT FUND IN MARCH 2012 - EU DIPLOMAT via RTRS
- TREATY CHANGE LIKELY TO BE DONE AMONG EURO ZONE PLUS OTHER COUNTRIES, BUT NOT AT 27 - EU DIPLOMATS via RTRS
- EU LEADERS AGREED PERMANENT ESM BAILOUT FUND WILL NOT HAVE A BANKING LICENCE -- EU DIPLOMAT
OK, so the ESM banking license rumor WAS a lie, there's no agreement on the next imaginary bailout fund, the ESM and won't be apparently for several more months and they can't agree with the 27 EU nations and now are looking to reach agreement among only the Euro nations, which is not the same as a Eurozone nation.
It seems the only sensible party that got involved with the EU (although that's near an oxy-moron), England, has their PM, David Cameron demanding concessions that Mer-Kozy won't cave in to.
EU fails to agree on treaty change among 27 states: diplomats
The European Union failed to secure backing from all 27 countries to change the EU treaty at a summit on Friday, meaning any deal will now likely involve the 17 euro zone countries plus any others that want to join, three EU diplomats said.
The European Union failed to secure backing from all 27 countries to change the EU treaty at a summit Friday, meaning any deal will now likely involve the 17 euro zone countries plus any others that want to join, three EU diplomats said.
An agreement at 27 fell through after British Prime Minister David Cameron demanded concessions that Germany and France were not willing to give, one of the officials said.
During nearly 10 hours of talks that lasted into the night, EU leaders did manage to reach agreement on a ceiling for the size of the euro zone's permanent bailout fund, the ESM, saying it would be capped at 500 billion euros.
That figure will be reviewed in July next year, when the ESM is due to come into force, the diplomats said.
The leaders also agreed to explore the idea of providing bilateral loans to the International Monetary Fund totalling 200 billion euros, with 150 billion of that coming from the euro zone , to bolster IMF resources to tackle Europe's debt crisis.
My gut feel on this was that the ECB demanded treaty changes before they got involved more aggressively, now or as of now, the summit is a failure in securing those treaty changes. In my view the market doesn't give a hoot about treaty changes, it only did in the context that the ECB "might" bring out the bazooka if the changes were made, so I don't see how this will be spun in to a market positive, but at this time ES isn't falling off a cliff either.
It seems integration will now be among the actual Euro currency member nations, but there's still disagreement with Ireland, and the northern European countries that are responsible for filling the next empty box of funds, the ESM.
I suppose Herman Van R. will find a way to spin something at the press-conference, but so far this doesn't sound at all like the successful summit that many were expecting with the only real doubt being what the ECB does upon completion. If there's no treaty change, the ECB is a moot point I would think and they probably are breathing a sign of relaxation that they don't have to be in the spotlight upon the completion of a successful summit as they clearly want t limit their role to their mandate which does not include bailing out sovereigns.
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