Britain and France today share a BIG 30 Billion Euro question

The recent spat between Britain and France as to which economy is the most ghastly, today gets some sensible analysis from David Marsh on Market Watch, linked here.

Serious business must resume today in the two countries respective treasuries as both nations must decide whether they must each throw some €30 billion extra down the drain, in the form of a bilateral loan to the IMF, in another vain attempt to save the doomed single euro currency. A radio report from the BBC on this will be linked here shortly. (Update: BBC is not providing a link to its 0724 GMT broadcast, Irish Times coverage on the teleconference call is here)

The IMF has historically never failed to recover funds loaned by itself to countries in trouble. The IMF, however, has never before tried to prop up a currency that cannot be devalued and does not constitute the currency of a fully sovereign state. That is the reason both Britain and France would be correct to refuse the advance of these extra amounts in the form of bilateral loans, disconnected form normal IMF funding requirements and restrictions.

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