- Aid package interest rate cuts have weakened incentives for sound public finances
- July 21 EU decision weakens responsibility for own finances; risks higher deficits in future
- Stronger incentives for sound public finances needed
- Expects robust German growth in Q3; winter months subject to considerable risks; should only be soft patch
- Risks financial turmoil impacts real economy
- German is the indispensable anchor for the euro zone economy
Sounds like someone doesn’t like the day the bailout culture is becoming ingrained in the fabric of Europe. This much seems clear: Those with the least skin in the game are all in favor of leveraging the EFSF, etc. Those who actually pya the bills (the Germans) are much less willing to play the leverage card, it seems.
EUR/USD easier after the comments, now at 1.3490 from 1.3515.
