Earlier today, in Spain, Italy, Belgium Bond Spreads Hit Euro Record; Italy 10-Year Bond Yield Highest Since 1997; Self-Fulfilling Crisis I was wondering how long it would take for emergency meetings.
Any bets on when the EU has another emergency meeting? I suspect two more days of this action might do it. Now answer this: what can they do that makes any sense?
Depending on your definition of “emergency meeting” the correct answer may have been less than a day.
Italy to Hold Financial Stability Meeting
Please consider Italy to hold financial stability meeting.
Finance Minister Giulio Tremonti will hold a meeting of Italy’s financial stability committee on Tuesday, including representatives from the central bank and bourse regulator Consob, a source said.
The committee will discuss “the sovereign debt market situation and the implications for the banks and the economy,” the source told AFP.
The meeting will take place at 1430 GMT at the finance ministry in Rome.
Italy’s Financial Stability Safeguard Committee, as it is formally known, was set up in 2008 as the global economic crisis first hit and includes representatives from stock market and insurance regulators.
Prime Minister Silvio Berlusconi is set to address parliament on the financial crisis on Wednesday and meet trade union leaders on Thursday.
Zapatero Delays Vacation to “Closely Watch Economic Indicators”
The Walll Street Journal reports Spain PM Delays Vacation To Deal With Economic Woes
Spanish Prime Minister Jose Luis Rodriguez Zapatero Tuesday postponed a scheduled vacation and Finance Minister Elena Salgado was talking to several of her European counterparts as borrowing costs for Spain and Italy hit new euro-era highs.
Zapatero cancelled his vacation in order “to more closely follow” the country’s “economic indicators,” according to a statement from his office. A spokesman added that Zapatero was in close contact with Salgado, while the finance minister has been talking with her Italian, French and German counterparts.
The new spike in borrowing costs comes two days ahead of a Spanish bond auction Thursday, where the treasury plans to sell between EUR2.5 billion and EUR3.5 billion of three- and four-year bonds.
It also heightens concerns about the abilities of Italy and Spain, the euro zone’s third- and fourth-largest economies, respectively, to finance themselves. In a recent research note, analysts at Deutsche Bank said Greece, Ireland and Portugal started to get frozen out of financial markets when their 10-year bond yields reached levels of between 6% and 7%.
Those three countries were then forced to seek bailouts from the European Union and the International Monetary Fund.
For Spain, the heightened market tensions come at an awkward time, politically, as the country gears up for an early general election on Nov. 20. Lacking a parliamentary majority and his popularity undermined by the economic crisis, Zapatero announced Friday that he was calling elections ahead of the end of his four-year term in March.
Does canceling a vacation to hold discussions with counterparts in Italy, France, and Germany constitute an “emergency meeting”? I think so, even if it is an informal one.
EU Claims “No Rescue Plans for Italy, Spain”
While pondering the definition of “emergency meeting”, please consider EU not considering rescue plans for Italy, Spain.
The European Union has no plans to provide rescue loans to Italy and Spain, despite the rising borrowing costs facing these countries, a European Commission spokeswoman said Tuesday.
“We are absolutely confident that the Spanish authorities will take all steps which are necessary,” Hughes said. “The question of a rescue plan is not on the table.”
“The situation is very similar for Italy,” she added.
Mish Translation of EU Statements
“We are scared completely s***less by these events. If we were not scared s***less, there would be no need to comment at all. Finally, if yields head North for another day we will call an emergency meeting to discuss rescue plans for Italy and Spain.”
Mike “Mish” Shedlock
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