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Dams, Jan
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5 articles of this author have been cited in the European Press Review so far.
Debtor states given a reprieve
With its cash injection the ECB is indirectly propping up Europe's debt-ridden states, giving them more time to find a solution to the crisis, notes the conservative daily Die Welt : "Already in the last few days we could see where part of the money was going - for example into Spanish government bonds. This led interest rates on these securities to drop temporarily. So with this move the ECB is helping not just the banks but indirectly and very deliberately also the ailing states of the Eurozone, giving them easier access to fresh funds. But those who believe that central banks flooding the markets with cash is the real solution to Europe's crisis fail to appreciate the huge dimensions of the problem. ... For Europe as a whole is not in stable balance. In countries like Greece and Portugal salaries are far too high for the lacking competitiveness of their economies. ... The ECB has bought them some time to finally address these issues."
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More from the press review on the subject » EU Policy, » Fiscal Policy, » Europe
Debt crisis will cost EU taxpayers billions
The debt crisis in Greece and Portugal will cost Europe's taxpayers a pretty penny and could lead to the collapse of the Euro system, the conservative daily Die Welt writes: "It's no surprise that no responsible politician is willing to risk something like that. But things don't have to stay that way. If the Greeks and Portuguese don't get a grip on their problems with the EU's help, few other options are left open. Either the Europeans in the North finance the poor countries in the South with tax billions for fear their own prosperity may dwindle, or movements like the 'True Finns' will lead the EU to turn off the money tap and these states will have to leave the EU. Both alternatives will cost Europe's taxpayers billions. Europe's policy-makers will need patience and wisdom to weather this crisis."
» full article (external link, German)
More from the press review on the subject » EU Policy, » Fiscal Policy, » Economic Policy, » Greece, » Europe
Greek payment deferral immoral
Greece's Finance Minister Giorgos Papakonstantinous Monday demanded longer repayment deadlines and lower interest rates for EU and IMF loans. The conservative daily Die Welt fears that the country is trying to shirk responsibility: "If the EU gives Greece more time to pay off its debts, it is essentially giving preferential treatment to the country's private creditors. The investors, who have earned good money on the loans, have been paid off with taxpayers' money. By 2013, if not before, Europe's taxpayers will then be shouldering more than half of Greece's debt. ... We cannot expect, as in the financial crisis, that the taxpayer alone should shoulder the costs for a debacle which was triggered by Athens' irresponsible tax policy and the banks' blind granting of credit. A payment deferral - if it is granted - can only be the first step in the restructuring of Greek finances, especially because this alone is not going to solve the problems. The second step must be that private creditors waive debts. This is an economic moral imperative."
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More from the press review on the subject » EU Policy, » Fiscal Policy, » Greece, » Europe
Markets need more transparency
Publishing the stress tests of only around 30 banks will not alleviate uncertainty in the capital markets, writes the conservative daily Die Welt: "And that for two reasons. Firstly, the tests have not yet dealt with the recent drop in value of European government bonds which gained momentum with the Greek crisis this spring. Consequently the impact for bank portfolios is not reflected in the test results. Secondly, no more than around 25 banks considered relevant to Europe's banking system participated in tests. Both the Spanish savings banks and the majority of Germany's long ailing federal state banks were left out of the picture altogether. ... If investors in capital markets are finally supposed to believe that the banks pose no threat to the stability of Europe's states, the transparency must extend far beyond the few banks already tested. For this reason the publication of the stress tests can't be considered any more than a first step."
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More from the press review on the subject » Banks, » Europe
Merkel pays the price for taking sides too soon
The US company General Motors (GM) is apparently reconsidering its decision to sell German carmaker Opel. The conservative daily Die Welt comments on the dithering: "Having secured the backing of the US government the giant has no intention of allowing a small subsidiary in Europe and the German government to force its hand. To ensure its own survival what was once the world's number one carmaker wants to secure access to Opel and perhaps even keep the company. And this is only to be expected: after all, many more jobs in the US depend on the car giant's survival than depend on Opel's continued existence in Germany. Now it is taking revenge on [German Chancellor Angela] Merkel for having abandoned her usual caution and committed herself early on for the sake of an electoral advantage. The chancellor has needlessly deprived herself of almost all negotiating options vis-à-vis GM. In the end she will perhaps even be forced to give in to all the Americans' demands, for any solution other than the sale to Magna and Russia's Sberbank will leave her looking like the loser."
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More from the press review on the subject » Corporations, » Economic Policy, » Germany, » Europe, » U.S., » Global
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