Friday, July 06, 2012

Finland, the ESM and the future of Europe

Finland is crucial to the Euro Zone group of countries as its collateral demands under the EFSF and ESM arrangements (soon to be the sole structures between EMU and its certain death) make it the only nation among the seventeen members of the common euro currency whose sovereign triple A credit rating still appears reasonably secure. Having at least one member contributing state, however small, still rated AAA, could be of profound significance to the borrowing activities of the ESM. Germany unless the ESM ratification can be successfully constitutionally challenged will soon have its credit rating at risk among the  worsening EU crash and worldwide recession so caused, Austria and Luxembourg cannot then be long behind.

Yet it is ironic beyond belief, that this very demand for Finnish collateral, results from that one country's obvious assessment that the project is certain to fail. A report from Bloomberg's Businessweek is linked here, it fails to report the earlier threat that Finland, if pushed could recall its parliament in August to halt the gaderene rush to pan-Eurozone national suicide.

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