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Spain First, Now Eurobonds?

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German news magazine Der Spiegel reported on Saturday that leaders of European institutions are working on a comprehensive plan to rescue the euro that would include the issuance of joint Eurobonds—a move Germany has repeatedly rejected.

The news magazine said European Union Commission President Jose Manuel Barroso, European Council President Herman Van Rompuy, Eurogroup head Jean-Claude Juncker and European Central Bank [cnbc explains] President Mario Draghi are working on plans for a “genuine fiscal union” in which individual member states would no longer be able to independently take on new borrowing.

Governments would only be able to decide how to spend money that is covered through their revenues, Der Spiegel reported. Any country that needs more money than it takes in would have to report that need to the group of euro finance ministers.

The magazine quoted four high-ranking EU planners saying this group of finance ministers would then decide which financial desires at which levels were justified and would then issue joint euro bonds to finance these new borrowing needs.

CNBC

The preceding article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

Posted-In: Forex

 

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