Monday, September 19, 2011

France approaches the end of its tether!

Open Europe daily email press briefing today has this extract from a leading French daily newspaper:

In Le Figaro, French Professor Édouard Tétreau argues, “France has already voted two bailout plans for Greece in two years, coming with a cost of more than €30bn – the equivalent of what is raised from income taxes in France in seven months. Who would agree, in our country, to work seven months to subsidise the lifestyle of people who are unable to pay their own taxes? By subsidising this organised robbery, we are not doing Greece, or Europe, a favour.” He suggests that the time has come to “drop Greece in order to save Europe. Sometimes, one needs to have an arm cut to survive.”

Worse still is the following exposé from Acting Man, linked here, of the French bank's exposure to other EU crisis-riven former nations:

France's biggest banks, which are known to have the biggest direct exposure to Greek government debt in Europe. As a result, Moody's has already downgraded these banks. However, the problems the French banks potentially face go well beyond Greece – as we noted in a recent update, they hold some € 140 billion in Spanish debt and € 400 billion in Italian debt. Overall, the liabilities of the three biggest French banks (Credit Agricole, BNP Paribas and Societe Generale) amount to €4.7 trillion – 250% of France's GDP.

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