Thursday, November 24, 2011

Sarkozy to Merkel: It's Time to Print

Following a failed German bond auction yesterday, where the Bundesbank had to step in and buy 39% of the securities offered, French President Nicolas Sarkozy is pressing German Chancellor Angela Merkel to let the European Central Bank start up the printing presses.

Reuters reports:
France pressed Germany on Thursday to let the European Central Bank act decisively to halt a stampede out of euro zone government bond markets that has raised doubts about the survival of the single currency.

French President Nicolas Sarkozy met German Chancellor Angela Merkel and new Italian Prime Minister Mario Monti in Strasbourg, seeking a trade-off between EU treaty change to impose greater fiscal discipline on euro zone states, demanded by Germany, and more emergency help from the central bank.

French officials hoped Berlin would relent in its opposition to a bigger crisis-fighting role for the ECB after Germany itself suffered a failed bond auction on Wednesday, highlighting how investors are wary even of Europe's safest haven.
Got that? The interventionists are going to trade among themselves the right to print huge amounts of money in "exchange" for the right to a grand fiscal centrally planned eurozone.

Bottom line: The people of Europe are going to get smacked good and hard from interventionists of all stripes, the money printers and the tax and spend interventionists.


  1. Reminds one of the U.S. Constitution coup.

    Crisis! Crisis! We need centralization!

    Worked like a least for the 'money printers and tax and spend interventionists.'

  2. Isn't the failed bund auction itself evidence that those lenders from whom Germany was attempting to borrow are now expecting debt monetization and thus inflation? Isn't the failed auction just evidence of the inflationary premium creeping in?