EC PRESIDENT CALLS URGENT MEETING FOR TOMORROW #2

TESCO IS MAKING CONTINGENCY PLANS FOR THE COLLAPSE OF THE EURO BECAUSE THEY HAVE A CORPORATE BOND IN EUROS.
HOPE THEY DON'T HAVE MORE PROBLEMS THAN THEY HAVE ALREADY.

Lioned wrote:Germanys GDP aint so hot either so we're probably all in the crapper.Personally i think the Euro is doomed.Germany is the strongest economy and they dont want to carry the rest,especially the PIIGS,so Humpty Dumpty 's gonna fall i recon.

Well, every analyst has said Greece will default and bring the Euro down with it.That the IMF has very little reserves and Brazil and Canada have said they will not support any payments to prop up the Eurozone. Neither will the U.S., the biggest Donator to the IMF. I suspect LaGarde, with her affinity to
France and the Euro has been behind these schemes to try to bail out European Countries .

I got a Euro bond and its cost me a wad of money in the last few months,i should of sold it 6 months ago,now i got to cry in my soup and wait till i die for it to recover.

Greece wont bring down the Euro zone they're just small fry really and anyone who's ever holidayed there will be delighted if it goes back to selling watermellons for a few drachmas of the back of a dirty old three wheel truck.But it will show how fragile and futile the whole business was to begin with.

Lioned wrote:I got a Euro bond and its cost me a wad of money in the last few months,i should of sold it 6 months ago,now i got to cry in my soup and wait till i die for it to recover.

You got one of those that was not Guaranteed did you Lioned? To be honest , the way Mercozy made the Banks take a 50% haircut means no one
can trust them and investors will be reluctant to buy Eurobonds now.Try and get your money back by buying Euro Lottery Tickets.

Lioned wrote:Greece wont bring down the Euro zone they're just small fry really and anyone who's ever holidayed there will be delighted if it goes back to selling watermellons for a few drachmas of the back of a dirty old three wheel truck.But it will show how fragile and futile the whole business was to begin with.

Oh yes Lioned those were the days. It's more expensive than Paris now lol

Talking about Paris, just been reading the mail online. It said that Sarkozy had to be physically restrained during the talks! well, well, well. In the comments someone said " Why did he find out who the father is?" Someone else said maybe he fell off his high heels or something like that

Lioned wrote:Greece wont bring down the Euro zone they're just small fry really and anyone who's ever holidayed there will be delighted if it goes back to selling watermellons for a few drachmas of the back of a dirty old three wheel truck.But it will show how fragile and futile the whole business was to begin with.

The reason Mercozy have been keeping Greece afloat is precisely because if the Country defaults the Euro value will drop like a stone and Countries
around the World will sell off their stock of euros. Of course it would mean a double dip recession , but in a way, I don"t think that is such a bad thing,
it would stop all this distortion of Banking, which has been the cause of this problem and a firm resolve that nothing like this would happen again. (Says
she hopefully.!!)

Also as i see it this 'debt' business is meaningless unless there is a tangible threat of penalties.
Like you default on your mortgage and the banks WILL kick you out on the street.I dont see the storm troopers being sent in to sort out another countries affairs,so they can huff and puff as much as they like but it wont ever change different cultures nor will it change the geography or demographics or turn barren lands into arable and profitable farms.
If all you have is Olive groves a few cockrels and Tourism and people cant afford to pay your inflated Holiday costs anymore then your off down the tubes and back to bed for your afternoon nap.

Lioned wrote:Also as i see it this 'debt' business is meaningless unless there is a tangible threat of penalties.
Like you default on your mortgage and the banks WILL kick you out on the street.I dont see the storm troopers being sent in to sort out another countries affairs,so they can huff and puff as much as they like but it wont ever change different cultures nor will it change the geography or demographics or turn barren lands into arable and profitable farms.
If all you have is Olive groves a few cockrels and Tourism and people cant afford to pay your inflated Holiday costs anymore then your off down the tubes and back to bed for your afternoon nap.

This new Treaty is enforceable by Law, but how can you get blood out of a stone? There was already in place a proviso that no Country could have debts greater than 3% of it"s GDP but surprise, surprise , Germany and France were the first to break it. there havn"t figured out yet how to monitor each
Country, will they need qualified accountants to do an Audit every month? Who is going to pay for all this and what is the point of suing a Country which is broke anyway?

Just had a look at the mail online, the comments column. It really sums it all up very well, plus comments about the doom mongering and terrible predictions of the BBC. All the other countries of Europe are clapping themselves on the b ack and we as usual shoot ourselves in the foot. It so annoys me

I think David has been a hero today all he has to do now is keep the faith and stand strong.

Goodnight all bed is calling

PS did anyone see that lithuanian prime minister/president having a go about us. What a bloomin cheek LITHUANIA!!!!!

Panda wrote:

Lioned wrote:Also as i see it this 'debt' business is meaningless unless there is a tangible threat of penalties.
Like you default on your mortgage and the banks WILL kick you out on the street.I dont see the storm troopers being sent in to sort out another countries affairs,so they can huff and puff as much as they like but it wont ever change different cultures nor will it change the geography or demographics or turn barren lands into arable and profitable farms.
If all you have is Olive groves a few cockrels and Tourism and people cant afford to pay your inflated Holiday costs anymore then your off down the tubes and back to bed for your afternoon nap.

This new Treaty is enforceable by Law, but how can you get blood out of a stone? There was already in place a proviso that no Country could have debts greater than 3% of it"s GDP but surprise, surprise , Germany and France were the first to break it. there havn"t figured out yet how to monitor each
Country, will they need qualified accountants to do an Audit every month? Who is going to pay for all this and what is the point of suing a Country which is broke anyway?

No point

Slightly off at a tangent. My son worked for a shop (chain) that went into liquidation about four years ago.They had no money but lots of assets (property) My son was payed up to date and thought that was quits ok,but then they said they owed him a couple of days Holiday money,which they didnt,but he got paid that anyway.Then every few months for the last four years they (accountants) have been sending him reams of paper reports on the state of the company assets.
Cant say i'm brilliant at reading the spread sheets but as i saw it the company had about £10Mill in assets which had gradually been 'liquified' and the accountants fees worked out to just over £6Mill !!

So the answer is yes ,the accountants if given half a chance will milk it for whatever they can get and for as long as they can make it last and the Politicians will be happy with that if they can get a few 'lunches' out of it.

fuzeta wrote:Just had a look at the mail online, the comments column. It really sums it all up very well, plus comments about the doom mongering and terrible predictions of the BBC. All the other countries of Europe are clapping themselves on the b ack and we as usual shoot ourselves in the foot. It so annoys me

I think David has been a hero today all he has to do now is keep the faith and stand strong.

Goodnight all bed is calling

PS did anyone see that lithuanian prime minister/president having a go about us. What a bloomin cheek LITHUANIA!!!!!

David Cameron is going to get a roasting from lots in Britain but no matter what the cost, if there was a referendum tomorrow, the Population would vote to get out of Europe.

Goodnight fuzeta , sleep well, I"m a night owl so going to watch a film now.

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Letter From Europe

Insularity Cuts 2 Ways for Britain

By ALAN COWELL

Published: December 9, 2011

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LONDON — The tunnel beneath the English Channel sometimes seems less a great feat of engineering and more a portal, like the secret entrance created by the writer C.S. Lewis to the magical land of Narnia. What is glaringly self-evident on one side seems correspondingly improbable on the other.





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Take, for instance, the summit meeting in Brussels on Thursday and Friday on the future of the euro.
For the 17 nations using the single currency, the months of debt-fueled crisis that have driven governments to the wall in Italy, Greece and elsewhere had spawned the apocalyptic notion that the euro might fail, destroying the most portentous foundation of the postwar European project. Once again, this fractious continent might be undone.
But in Britain, that same crisis had a different impact, compressed through a narrower prism and summoning forth once again the clanking ghost of euro-skepticism — the belief that Britain should distance itself from the 27-nation European Union, of which it is a member, for fear of diluting its sovereignty in the dense mash of European regulation and Franco-German hegemony.
For history writ large, read politics writ small.
And by dawn on Friday, President Nicolas Sarkozy of France had indeed announced that Britain would stand aside from a new pact enforcing stricter financial controls on European nations.
“This is a summit that will go down in history,” he said. “We would have preferred a reform of the treaties among 27” nations. “That wasn’t possible, given the position of our British friends,” so the new deal will be based on the 17 members of the euro zone and those non-euro lands that wish to join them.
“What is on offer isn’t in Britain’s interests,” Prime Minister David Cameron said. “So I didn’t agree to it.” After wielding its European veto to satisfy euro-skeptics back home, Britain could well end up as a lonely holdout — hardly a new phenomenon.
“We are with Europe, but not of it,” Winston Churchill wrote in 1930. “We are linked but not compromised. We are interested and associated but not absorbed.”
For centuries, history and geography have combined to divide Britain and Continental Europe far more profoundly than the 22 miles, or 35 kilometers, of water of the Channel. Driving this week on the A16 highway from Paris to Calais, even the road signs seemed like the milestones of a long and troubled past, from the Battle of Crécy of 1346, to the slaughter of the Somme that defined the horror of the First World War, and on to the Normandy littoral so central to the strategies of the Second.
Each conflict, moreover, seems to have reinforced Britain’s sense of a separate, insular destiny, more comfortable with distant cousins across the Atlantic than neighbors close by.
Shortly before the D-Day landings of 1944, Churchill told the French general Charles de Gaulle that every time Britain had to “decide between Europe and the open sea, it is always the open sea that we shall choose.”
“Every time I have to decide between you and Roosevelt,” he said, referring to the wartime U.S. president, “I shall always choose Roosevelt.”
It took a while for de Gaulle to conjure a riposte as he opposed Britain’s entry to the European club in 1963. “England is an island, maritime, and linked through its trade, markets and food supplies to very diverse and often distant countries,” he said. “In short, the nature and structure and economic context of England differ profoundly from those of the other states of Europe.”
Recent events have proved both men right.
In 2003, Britain sided with the United States in the invasion of Iraq against the express opposition of a European coalition of the unwilling led by France. To this day, Britain’s financial services industry — the so-called City of banks and investment houses — is driven far more by the sharp-elbowed model of Wall Street than by any European equivalent in Frankfurt, Paris or Milan. Indeed, much of Mr. Cameron’s veto of a broader treaty was designed to shield the traders of the City from closer European intrusion and taxation.
For all that, the debate is shaded by a peculiar quandary.
Britain is not a member of the euro zone. Indeed, there is a discernible smugness among British leaders when they point out that, as the yield on some European bonds clicked up to unsustainable levels, British debt remained relatively cheap — a token of the market’s confidence in the standalone pound sterling.
But, for all the evocations of the doughty British bulldog, Britain cannot simply stand alone: half of its trade is with Europe, anchoring its economic interests across the Channel.
In recent years, British leaders from the Labour Party’s Tony Blair to David Cameron, from the largely euro-skeptic Conservative Party, have sought to stride the European stage alongside their counterparts from Paris and Berlin, wishing to exert influence without paying the ultimate price of joining the euro.
But at a time of crisis, Britain’s ambivalence undermines its ability to sway events — a marginalization that some in Brussels believe will now deepen.
Of course, much of Europe’s maneuvering is deeply rooted in the hard-nosed domestic policies of political survival. Mr. Cameron is now caught in a perilous and unpredictable battle between euro-skeptics within his own party, clamoring for further isolation from Europe to be enshrined by a referendum, and his own Liberal Democrat coalition partners opposed to such measures. Mr. Sarkozy is facing elections next year. Chancellor Angela Merkel of Germany is deeply sensitive to her voters’ antipathy to financing Europe’s bailout, or to measures that risk provoking inflation.
“The bottom line,” the columnist Ralf Behr wrote in The New Statesman before the summit meeting, “is that Cameron is a spectator.” What worries some Britons is that, increasingly, they will observe the play just across the Channel — and have ever less clout with the players.


A version of this article appeared in print on December 10, 2011, in The International Herald Tribune with the headline: Insularity Cuts 2 Ways for Britain.

The
top US military commander, Gen Martin Dempsey, says he is concerned
about "the potential for civil unrest" as Europe's financial crisis
unfolds.

Gen Dempsey said it was unclear the latest steps taken by EU
leaders would be enough to hold the eurozone together, adding that a
break-up could have consequences for the Pentagon.

Twenty-six of the 27 EU countries have agreed to forge a tighter fiscal union.

Only the UK refused to sign up to a new treaty, citing national interest.

Gen Dempsey, who is chairman of the Joint Chiefs of Staff,
told an event hosted by the Atlantic Council, a Washington think-tank:
"The eurozone is at great risk."

"I know that they've taken some measures here with the 17
members of the eurozone to try to better align... monetary and fiscal
policy. But it's unclear, to me at least, that that will be the glue
that actually holds it together."

Funding impact?
Gen Dempsey previously served as the Army's Chief of Staff and as a general in Iraq.


Continue reading the main story Euro agreement - from the papers





The Guardian says Britain is "facing isolation in Europe" after David Cameron vetoed a revision of the Lisbon treaty.

In the Economist, the Charlemagne's notebook blog describes the agreement - and Britain's non-participation - as Europe's "great divorce".

The Financial Times says EU leaders are "struggling to cope" with what it describes as "a profound split".

The New York Times describes the agreement
as "not a perfect solution," because it could be seen as
institutionalizing a two-speed Europe - but it says the pact could be
ratified much more quickly than a full treaty amendment.

• Q&A: Key EU summit on debt crisis
  
• Eurozone deal: Your views
  
• EU nations and the euro
  
• Peston: Markets test flunked again?
  
• Analysis: Deal means less sovereignty
  

He suggested that part of his
concern was that the US military could be exposed to any unravelling of
the eurozone "because of the potential for civil unrest and the break-up
of the union".

The US military has more than 80,000 troops and 20,000 civilian workers in Europe, many based in Germany.

Gen Dempsey also said he was concerned that an international
project to develop the F-35 Joint Strike Fighter aircraft could be put
in jeopardy if European national defence budgets were cut.

"It will clearly put [budgets] at risk if all the economic
predictions about a potential collapse were to occur," Gen Dempsey said.

At an emergency EU summit that ended in Brussels on Friday,
the UK effectively used its veto to block an attempt, led by the French
and Germans, to get all 27 members states to support changes to the
union's treaties.

Instead, eurozone members and others will adopt an accord with penalties for breaking deficit rules. It will be backed by a treaty between governments, not an EU treaty.

Austerity measures
The announcement on Friday produce little reaction from
financial markets, which are still hoping for more intervention by the
European Central Bank (ECB).

The BBC's Chris Morris says that without further action to
lower the cost of borrowing, likely by the ECB, the eurozone still faces
a threat.

The rising costs of borrowing in some eurozone countries have
pushed governments to pass new austerity measures and to the
International Monetary Fund as they struggle to pay their debts.

Europe's debt crisis has already unseated two political
leaders and their governments: former Greek Prime Minister George
Papandreou and Italian leader Silvio Berlusconi.








More on This Story











Global Economy

What The Prime Minister Really Asked For In Brussels

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Ed Conway

December 09, 2011 3:44 PM

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Let’s be clear about this: what David Cameron tried to do in Brussels wasn’t merely to try to safeguard Britain’s financial services. He just attempted to repatriate powers which have already legally been transferred to Europe.
It’s gradually becoming clear that there was nothing intrinsic in the European Council’s conclusions it agreed to early this morning
that would have directly threatened the City – save, perhaps, for the
proposal to move the HQ of the European Banking Authority out of London.
None of the extra fiscal rules would have directly affected the UK.
There was no detailed discussion or proposals about a financial
transactions tax (and, anyway, tax is decided on a unanimity basis so
Britain would never risk having something like that imposed on it
without its approval). None of the new fiscal rules will be imposed on
non-euro EU members such as the UK.
So although the Prime Minister told Adam Boulton earlier today that
the decision would have involved an erosion of UK sovereignty, the
reality is that the erosion happened (in legal terms at least) some time
ago. The PM’s tactics in Brussels amounted to an attempt to reverse
some of those legal sovereignty erosions.
Let me explain. The City
is extremely important to Britain – far more important than any of the
other industries which are currently regulated from Brussels. At 10% of
Britain’s GDP or thereabouts it is enormous in comparison with
agriculture (0.65% of GDP) and fisheries (0.05%).
The issue is
that for some time Brussels has been allowed, legally, to impose
regulations on and supervise the City through qualified majority voting
(QMV), which means Britain wouldn’t have a veto on certain new
regulations which would directly affect the square mile. Under the
letter of the law, Brussels could well impose stringent new rules on
trading in London, could well demand that they supervise any American
bankers working in London. It hasn’t necessarily *used* these rules,
since, under something called the Luxembourg Convention, Brussels has
tended, in practice, to steer clear of imposing new rules on countries’
key industries by QMV.
The fear, however, is that Europe was
increasingly looking as if it was going to ignore these long-standing
conventions and start to impose itself, via QMV, on the City –
potentially undermining Britain’s biggest industry. Which brings us back
to Brussels: Mr Cameron tabled an extra amendment to the existing
Treaty (known in eurocrat-speak as a protocol) which would put these
conventions (no intrusive new supervision under QMV, no new rules
policing non-EU employees in the City) into law. The Telegraph has laid its hands on the protocol.
Having
read the protocol myself, my judgement is that these requests amount,
in de jure if not de facto terms, to a repatriation of powers. That is
what the Prime Minister tried to achieve in Brussels. He failed to
achieve it this time around, but one suspects this is only the beginning
of the story. Under the letter of the law, Brussels can indeed now
impose the kind of regulations Mr Cameron and George Osborne are
privately so worried about – but there is a possibility that they may
not be written directly into UK law, something that would go against
Parliamentary convention since the foundation of the EU.
Many
questions still remain: can the signatories to the pact actually achieve
a new fiscal union? Can the euro find a big enough bazooka to save it?
Will this mark the beginning of a quiet war between the UK and the EU?
Will either side relent?
Either way, this was not merely a gamble
but a statement of intent. David Cameron wants to claw back powers he
wishes had never been handed over to Brussels. He can brand this as
“safeguarding” all he likes, but the reality is rather more equivocal.
PS It’s well worth reading the report from Open Europe which seems to have influenced and informed the Prime Minister’s position negotiating in Brussels.










david_cameron

It has been reported that Sarkozy is going to take revenge on the UK. Am I reading right? Is the president of a civilised European country actually saying this? It is beyond belief and a disgrace. Perhaps he is declaring war, hiding behind, as they say, " Germany's skirts" Well he is backing the wrong side as usual

He is certainly not fit to be a president of France. He had to be Physically restrained during the meetings. He is not a gentleman as he avoided shaking hands with David Cameron. appalling behaviour from a European president.

If we are standing alone now, we have done it before and the French and a lot of other European countries can be thankful that we did!

We will be fine if we stand strong. That treaty has not been signed yet. Wait until they all read the small print.

Loved the front page of the Times today, made my day

Ithink Cameron was trying to get more than the Transaction fees and there is mixed reaction to what he did, not least from his coalition partner Nick
Clegg. Sarkozy behaved very badly and it may be on his mind that he faces an Election in 4 months and wanted to see the new plan passed before then.
With 3 French Banks downgraded and possibly more, he may not win the Election, I think Merkel and Sarkozy made a big mistake by concentrating on this
new fiscal rule when the whole World is facing lack of growth . Draghi seems to be less adamant than he was about the role of the ECB which shows how they can bend the Rules when it suits. It was only last week he was saying it was not part of the Treaty.

The next few weeks will be crucial, once Christmas spending is over.

Panda wrote:Ithink Cameron was trying to get more than the Transaction fees and there is mixed reaction to what he did, not least from his coalition partner Nick
Clegg. Sarkozy behaved very badly and it may be on his mind that he faces an Election in 4 months and wanted to see the new plan passed before then.
With 3 French Banks downgraded and possibly more, he may not win the Election, I think Merkel and Sarkozy made a big mistake by concentrating on this
new fiscal rule when the whole World is facing lack of growth . Draghi seems to be less adamant than he was about the role of the ECB which shows how they can bend the Rules when it suits. It was only last week he was saying it was not part of the Treaty.

The next few weeks will be crucial, once Christmas spending is over.

Hello Panda Nick Clegg as you know is a euro fanatic as are all liberal democrats. The BBC reporting is outrageous. Do they not think that we should be supporting our country in this awful time and not doom mongering. They are that far left they almost complete the political circle!

Why do we British always shoot ourselves in the foot? Other countries are clapping themselves on the back. writing terrible things about us. Our media is trying to bring us down. What on earth are we like?? We should be congratulating Cameron not trying to bring him down.

The eurozone has done nothing to save the euro, they prefer to blame us for all the disasters that will unfold and they will unfold

The majority of the British public are in full support of what Cameron did. If he had not done it he would have been finished. Now we need to leave the whole dreadful mess of it. The time will come.

IMO the euro is finished it might be a slow death but it is gone.

As I said before wait until the other countries read the small print, I reckon we will not be on our own then!

Hi fuzeta, Ireland might not sign because of the uniform Corporation Tax demanded. Theirs is only 12.5% which has attracted a lot of new Businesses
especially from U.S. IT companies. Ireland was out of recession until the Italian crisis became evident, Sweden, Hungary and Czechloslovakia will discuss
with their Governments before signing.

The way the EU is being run it is like the old days when Britain was paid to leave fields fallow because of a Mountain of Wine and Milk overproduced and
we acquiesced without thought for the way it would affect our ability to feed ourselves so now we rely on imported vegetables and Fruit.....it"s crazy.
When Gordon Brown signed the last Treaty why did no Government Minister say halt, what are we doing???? Now you have Labour berating Cameron,
forgetting they had 13 years in Power with a Prime Minister who was an ardent europhile.

why shouldn"t we take back the right to govern ourselves, we can still trade in Europe, China and India and Japan are not in the Union but they trade freely.

Panda wrote:Hi fuzeta, Ireland might not sign because of the uniform Corporation Tax demanded. Theirs is only 12.5% which has attracted a lot of new Businesses
especially from U.S. IT companies. Ireland was out of recession until the Italian crisis became evident, Sweden, Hungary and Czechloslovakia will discuss
with their Governments before signing.

The way the EU is being run it is like the old days when Britain was paid to leave fields fallow because of a Mountain of Wine and Milk overproduced and
we acquiesced without thought for the way it would affect our ability to feed ourselves so now we rely on imported vegetables and Fruit.....it"s crazy.
When Gordon Brown signed the last Treaty why did no Government Minister say halt, what are we doing???? Now you have Labour berating Cameron,
forgetting they had 13 years in Power with a Prime Minister who was an ardent europhile.

why shouldn"t we take back the right to govern ourselves, we can still trade in Europe, China and India and Japan are not in the Union but they trade freely.

Agreed on all points raised Panda. Makes me fume Blair thought he was in for the top job, that is why he sold us out with the Lisbon Treaty Not very intelligent was he? He sold his soul to the devil and we are suffering for it. He seems ok though, suntanned and very rich.

Labour are not doing themselves any favours here, they have already lost a few million votes with their comments about what Cameron did. Are they so blind to what the ordinary people think? Do thay not know that the main part of the British public support Cameron. Yes they are blind, they were blind for 13 years so no change there lol

Euro Crisis Pits Germany and U.S. in Tactical Fight

By NICHOLAS KULISH

Publish






BERLIN — Even as European leaders put together their latest response to the euro crisis last week, a German-American clash over how best to manage a vast financial crisis and put the world economy back on a sound footing was set in stark relief.

Enlarge This Image

Thierry Roge/Reuters

Chancellor Angela Merkel of Germany, shown in Brussels on Thursday, views the financial industry with profound skepticism.



Multimedia


Interactive Feature
Tracking Europe's Debt Crisis



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• German Vision Prevails as Leaders Agree on Fiscal Pact(December 10, 2011)
  
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Susana Vera/Reuters

A euro coin promoting prices at a pizzeria in Madrid. President Obama warned about short-term threats to the currency.


Chancellor Angela Merkel of Germany defied skeptics and laid the groundwork for a deeper union that she said rights the mistakes of the euro’s birth and puts integration on a stable path for the long term. In the process, she forced German fiscal discipline on Europe as the prescription for combating the ills that afflict the region.
Yet even as the cogs of the European agreement were being fitted into place, President Obama warned in his most explicit comments on the matter to date that the European — read, German — focus on long-term political and economic change was well and good. But any changes, he said, risked coming undone if leaders did not react quickly and powerfully enough to the market forces threatening the euro’s survival in the coming months.
At the heart of the debate is the question of how far governments must bend to the power of markets. Mr. Obama sees retaining the stability of markets and the confidence of investors as a primary goal of government and a prerequisite for achieving any major changes in public policy. Mrs. Merkel views the financial industry with profound skepticism and argues, in almost moralistic fashion, that real change is impossible unless lenders and borrowers pay a high price for their mistakes.
“It’s a battle of ideas,” said Almut Möller, a European Union expert at the German Council on Foreign Relations. “There is a different understanding of how to set up a sustainable economy in a globalizing world. Here there is a major rift.”
It will be difficult to know for weeks, or maybe even in months, which approach is right. But it is clear that the stakes are high, with the health of the world economy, the European Union and perhaps Mr. Obama’s presidential hopes hanging in the balance. Economists have fretted for months that forcing austerity plans on Europe’s troubled economies — while a good long-term solution — could lead to deep recessions in the short term, compromising any chance for effective change.
On a political level, Mrs. Merkel could look back on last week’s meeting of leaders in Brussels and declare, “We have succeeded.” Where her mentor, former Chancellor Helmut Kohl, failed, Mrs. Merkel managed to push through enforceable oversight of government spending that would allow the European Court of Justice to strike down national laws that violate fiscal discipline.
Initial market reaction to the Brussels meeting was positive, but that has happened before as deal after deal has been struck between European leaders. Skeptics say that, economically, Mrs. Merkel, the hard-line austerity queen of Europe, has won a hollow victory, one that will fall apart like every other solution that was proclaimed as lasting but proved to be fleeting.
“If the new arrangement turns out to be too toothless to enforce the rules, we’ll be back to square one,” said Thomas Klau, a political analyst and head of the Paris office of the European Council on Foreign Relations.
Just ahead of Mrs. Merkel’s unexpectedly robust success, Mr. Obama issued his unheeded warning from across the Atlantic. “There’s a short-term crisis that has to be resolved,” he said, “to make sure that markets have confidence that Europe stands behind the euro.”
Mr. Obama is fiercely proud of the record he achieved in keeping not just the United States but also the entire world out of an acute financial meltdown after 2008, presiding over enormous stimulus spending in tandem with unrestrained support from the Federal Reserve. The president and his allies now say that in doing so, they may well have prevented the world from falling into another Great Depression.
By ignoring the short-term threat, American officials say, Mrs. Merkel is unwittingly courting the very threat they so narrowly managed to keep at bay. Strong governments can borrow cheaply, mainstream economists on both sides of the Atlantic argue, and have an obligation to intervene more aggressively than they would in normal times to make up for the slump in private demand.

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A version of this article appeared in print on December 11, 2011, on page A10 of the New York edition with the headline: Euro Crisis Pits Germany And U.S. in Tactical Fight.

Nick Clegg was sounding off on a T.V. interview saying although Cameron telephoned him to say he had not got any reassurance about
the transaction tax and other considerations, he did not tell him he was going to Veto the amendments to the Treaty. When asked if the
Lib Dems would break the Coalition, he would not go that far because he knows the Coalition is the only way for the Lib dems to have any
Power.

Many Press reports suggest Britain will now be isolated , but what if this EU crisis is not over? what if more Banks fail when there is not
sufficient funds to lend them money and the ECB refuse? What if the reformed Treaty is supposedly due to be effected next March, but
in the meantime there is very little growth around the World and Greece defaults.?

A poll shows 62% of the British Population want a Referendum, so if matters get worse the Eurozone might fall apart anyway.

Panda wrote:Nick Clegg was sounding off on a T.V. interview saying although Cameron telephoned him to say he had not got any reassurance about
the transaction tax and other considerations, he did not tell him he was going to Veto the amendments to the Treaty. When asked if the
Lib Dems would break the Coalition, he would not go that far because he knows the Coalition is the only way for the Lib dems to have any
Power.

Many Press reports suggest Britain will now be isolated , but what if this EU crisis is not over? what if more Banks fail when there is not
sufficient funds to lend them money and the ECB refuse? What if the reformed Treaty is supposedly due to be effected next March, but
in the meantime there is very little growth around the World and Greece defaults.?

A poll shows 62% of the British Population want a Referendum, so if matters get worse the Eurozone might fall apart anyway.

Hi Panda,

I think the LibDems, especially Clegg, are done for. Polls suggest they've only got about 10% of the vote...I don't see them breaking the coalition otherwise they will just disappear into a bottomless pit...they will cling to every bit of power they can.

ETA...Greece is still a huge problem and if anything will drag the Euro down it will be them. The Euro could crash before any of this gets sorted out.

With a bit of luck, companies might start bringing their businesses to London in an attempt to avoid taxation in other countries!

Angelina wrote:

Panda wrote:Nick Clegg was sounding off on a T.V. interview saying although Cameron telephoned him to say he had not got any reassurance about
the transaction tax and other considerations, he did not tell him he was going to Veto the amendments to the Treaty. When asked if the
Lib Dems would break the Coalition, he would not go that far because he knows the Coalition is the only way for the Lib dems to have any
Power.

Many Press reports suggest Britain will now be isolated , but what if this EU crisis is not over? what if more Banks fail when there is not
sufficient funds to lend them money and the ECB refuse? What if the reformed Treaty is supposedly due to be effected next March, but
in the meantime there is very little growth around the World and Greece defaults.?

A poll shows 62% of the British Population want a Referendum, so if matters get worse the Eurozone might fall apart anyway.

Hi Panda,

I think the LibDems, especially Clegg, are done for. Polls suggest they've only got about 10% of the vote...I don't see them breaking the coalition otherwise they will just disappear into a bottomless pit...they will cling to every bit of power they can.

ETA...Greece is still a huge problem and if anything will drag the Euro down it will be them. The Euro could crash before any of this gets sorted out.

With a bit of luck, companies might start bringing their businesses to London in an attempt to avoid taxation in other countries!

I hope so Angelina. I saw that we have on a daily basis 40% of trading whilst the French has 3% and the Germans 2%. No wonder they wanted control of it . They wanted to bleed us dry. They did nothing to sort out the euro crises nor will they in my opinion. It will crash in the end