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Monday, July 30, 2012

WOW - Enter the Twilight Zone! Germany and Italy, the two most indebted countries in Europe, vow to save the Eurozone

July 29, 2012 – EUROPE – German Chancellor Angela Merkel and Italian Prime Minister Mario Monti will do everything to protect the euro zone and swiftly implement measures agreed by European leaders in June, their governments said in a statement on Sunday. The wording of the statement, issued after the pair discussed the euro zone crisis in a phone call on Saturday, echoed a pledge made by Merkel and French President Francois Hollande on Friday and the European Central Bank (ECB) President Mario Draghi on Thursday. European leaders have gone on the offensive in recent days, underlining their commitment to tackling the euro zone’s crippling debt problems and seeking to restore calm after a week in which Spanish bond yields hit euro-era highs and Greece raised concern it would be unable to honor its bailout conditions and could exit the euro. Draghi’s comments were read by markets as an indication the ECB may revive its program of buying bonds of troubled governments on the secondary market. Near-bankrupt Greece is desperately struggling to make savings. Its creditors are currently in Athens to assess progress and decide whether to keep it hooked up to a 130-billion euro lifeline. Greek political leaders had agreed on most of the austerity measures demanded by creditors, a source close to talks said on Sunday, and politicians were now eyeing pension and wage cuts to find the final 1.5 billion euros of savings still needed. Greece must find savings worth 11.5 billion euros for 2013 and 2014 to satisfy its increasingly impatient lenders. German Finance Minister Wolfgang Schaeuble said there was no room for any more concessions for Greece, in an interview published in Welt am Sonntag newspaper on Sunday, a view echoed by German Economy Minister Philipp Roesler. Policymakers are working on “last chance” options to bring Greece’s debts down and keep it in the euro zone, with the ECB and national central banks looking at also taking significant losses on the value of their bond holdings, officials said.  –Reuters
And now, for our next trick: These two countries have $4 trillion in debt between the two of them. If they have been unable to fix their own budget deficit problems, how can they possibly save the eurozone we ask? This is more politcal nonsense and stall tactics to buy time, while the ECB fires up the printing presses. If you haven’t found the exit signs yet; now would be good time to start looking. -The Extinction Protocol

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