Nothing can happen until Spain and then Italy request a rescue from the EU
bail-out funds (EFSF/ESM), and sign away their sovereignty. Nothing further
can happen until an angry Bundestag approves the terms and signs away its
money.
Germany has a 27pc voting weight and can veto any rescue.
Even less can happen if the German constitutional court issues a preliminary
ruling on Wednesday blocking activation of the €500bn ESM fund. Morgan
Stanley's team – mostly Germans as in happens – put a 40pc likelihood on
this happening.
This is not to belittle the ECB plan for "unlimited" bond purchases.
The Jesuit-trained Mario
Draghi has pulled off a masterstroke, securing the assent of every
northern ECB governor except the Bundesbank's Jens Weidmann, and crucially
the assent of Germany's board member Jorg Asmussen, and indeed Chancellor
Angela Merkel herself.
Italy's premier Mario Monti – a fellow `Jesuit' – more or less confessed that
this minor revolution could not have happened without the defeat of French
leader Nicolas Sarkozy in May. The election upset broke the Franco-German
axis and reordered the strategic landscape of Europe.
Read more: http://www.telegraph.co.uk/finance/comment/9531764/Carthaginian-terms-for-Italy-and-Spain-threaten-Draghi-bond-plan.html
Read more: http://www.telegraph.co.uk/finance/comment/9531764/Carthaginian-terms-for-Italy-and-Spain-threaten-Draghi-bond-plan.html
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