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TheNegotiator

Just Another EU Summit

By TheNegotiator, in Market News & Analysis

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TheNegotiator    13

TheNegotiator
Posted

Is it me or have we heard it all before when it comes to these EU Summits? Today marks the start of the 19th summit in 2 years. That's right, the 19th! There's talk about Germany being willing to negotiate on Eurobonds and also trying to get Italy's borrowing costs to fall to below 4% from it's current 6.2%. Spain surely will be on the agenda with their borrowing costs ~7% and having just formally asked for financial (and unconditional!) support for their banking sector. Here's a brief schedule:- http://www.telegraph.co.uk/finance/financialcrisis/9359289/EU-Summit-schedule.html

 

What do they actually achieve I ask other than wasting their time and tax payers money? Sure, they need to meet and discuss the way forward. Just as they do in their own countries- which clearly hasn't helped matters either. So what is it then? A reassurance to the markets that "we know there's a problem and we're on the case" followed by a jolly up in Brussels? Because seriously, I do not know what they actually expect to achieve other than process. By this I mean banging heads against brick walls for long enough to eventually realise that the EU is fundamentally flawed. I don't see them as especially well qualified to take proper measures. After all, they are politicians right? They just want to be re-elected in the mean time and convince themselves they are doing the right thing- there's no better lie than one told by someone who believes it's true.

 

So I ask you again, what on earth do they do at these damn EU Summits and why should we even raise an eyebrow each time another one of these pointless ceremonies rolls around?

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MightyMouse    12

MightyMouse
Posted
Is it me or have we heard it all before when it comes to these EU Summits? Today marks the start of the 19th summit in 2 years. That's right, the 19th! There's talk about Germany being willing to negotiate on Eurobonds and also trying to get Italy's borrowing costs to fall to below 4% from it's current 6.2%. Spain surely will be on the agenda with their borrowing costs ~7% and having just formally asked for financial (and unconditional!) support for their banking sector. Here's a brief schedule:- EU Summit: schedule - Telegraph

 

What do they actually achieve I ask other than wasting their time and tax payers money? Sure, they need to meet and discuss the way forward. Just as they do in their own countries- which clearly hasn't helped matters either. So what is it then? A reassurance to the markets that "we know there's a problem and we're on the case" followed by a jolly up in Brussels? Because seriously, I do not know what they actually expect to achieve other than process. By this I mean banging heads against brick walls for long enough to eventually realise that the EU is fundamentally flawed. I don't see them as especially well qualified to take proper measures. After all, they are politicians right? They just want to be re-elected in the mean time and convince themselves they are doing the right thing- there's no better lie than one told by someone who believes it's true.

 

So I ask you again, what on earth do they do at these damn EU Summits and why should we even raise an eyebrow each time another one of these pointless ceremonies rolls around?

 

The summit will produce a statement that they hope will calm the snow ball from continuing to roll down hill. They hope to change sentiment without committing. No one wants to commit since commitment comes with a large cost. So, so much will have to change to have an effective single currency. It is not something that can occur in less than 5 years. 5 years may be too optimistic since 2 years have passed and nothing has changed other than some money being thrown at the problem.

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TheNegotiator    13

TheNegotiator
Posted
The summit will produce a statement that they hope will calm the snow ball from continuing to roll down hill. They hope to change sentiment without committing. No one wants to commit since commitment comes with a large cost. So, so much will have to change to have an effective single currency. It is not something that can occur in less than 5 years. 5 years may be too optimistic since 2 years have passed and nothing has changed other than some money being thrown at the problem.

 

Absolutely agree. But at some point they will have to do something. This is not just about sentiment, this is about fundamental instrinsic flaws in the system and the current problems which have been created because of them. 5 years maybe they will have "commited" but I fear it could be much longer before things start to organically improve.

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Obsidian    10

Obsidian
Posted
Is it me or have we heard it all before when it comes to these EU Summits? Today marks the start of the 19th summit in 2 years....

 

So I ask you again, what on earth do they do at these damn EU Summits and why should we even raise an eyebrow each time another one of these pointless ceremonies rolls around?

 

It is not only 2 years, crisis did not start in one day...

We have seen this movie many times...I have no idea why they bother gathering..they simply do nothing :rofl:

more countries are suffering as the time passes...the last victim was Cyprus..probably Italy will be next...we are going to wait and see...

so far EU summits would help the euro to climb..but now I see that people don't buy it anymore...

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MightyMouse    12

MightyMouse
Posted
Absolutely agree. But at some point they will have to do something. This is not just about sentiment, this is about fundamental instrinsic flaws in the system and the current problems which have been created because of them. 5 years maybe they will have "commited" but I fear it could be much longer before things start to organically improve.

 

They will probably start with a bank program. Something to unify all the banks under one program and somehow centralize the management and risk of those banks. I suspect that there will be member states who will want to leave. Stronger members who do not want to be micro managed and who stand to lose. Seems like a natural response. But it will lead to a prolonged process. There are too many established systems that would have to be changed to make a single currency work. Then I am not too sure why anyone would want a single currency like the US.

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