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China warns it cannot 'cure' eurozone's debt crisis
China has stressed it will not be a "savior" to Europe as President Hu Jintao embarks on an official visit to the continent that will take in this Thursday's crucial G20 summit in Cannes.
The warning came as European Commission President Jose Manuel Barroso and European Council President Herman Van Rompuy urged G20 leaders to use the meeting of major economies to address Europe's debt crisis, saying measures proposed last week were not enough by themselves.
French President Nicolas Sarkozy has said Beijing had a "major role to play" in proposals to expand the European Financial Stability Facility (EFSF) to €1 trillion (£877bn), possibly through a special purpose investment vehicle that would attract backing from sovereign wealth funds.
The head of the bail-out fund, Klaus Regling, was despatched to Beijing to discuss terms, but traveled on to Japan at the weekend without an agreement.
China, holder of the world's largest foreign exchange reserves at $3.2 trillion, said it wanted more clarity before investing.
The official Xinhua news agency, used to communicate Communist Party policy, said Europe must address its own financial woes. "China can neither take up the role as a savior to the Europeans, nor provide a 'cure' for the European malaise," it stated. "Obviously, it is up to European countries themselves to tackle the
Chinese officials also sought to play down hopes of a breakthrough at the G20. Vice Finance Minister Zhu Guangyao said that investment in the bail-out fund was not on the agenda at present.
European leaders remain under immense pressure to provide more detail about the terms of last week's refinancing proposals, which are set to cut Greek debts by 50pc, and see a €100bn re-capitalisation of eurozone banks.
(Copied from the Telegraph)
Who would have thought a few years ago that the world would be relying on a communist Gov. to bail everyone out, amazing!!!-
(The Telegraph) -
The FTSE 100 slipped 2.77pc, the CAC dropped 3.16pc, theDAX slipped 3.23pc and the Italian FTSE MIB tumbled 3.82pc as the country's 10-year bond yields rose above 6pc.
Angus Campbell, head of sales at Capital Spreads, said:
The rally from last week has come to an abrupt end today as investors sold risky stocks for fear that markets have got ahead of themselves when the EU plans announced last week were too short on detail.
Stocks were also hit by the filing for bankruptcy of brokerage firm MF Global which goes down as the latest casualty of the European sovereign debt crisis.
NEW YORK (Reuters) - MF Global Holdings Ltd filed for bankruptcy protection after a tentative deal with a buyer fell apart, marking a stunning failure for CEO Jon Corzine who tried to turn the more than 200-year-old futures brokerage into a mini-Goldman Sachs.
The meltdown made MF Global the biggest U.S. casualty of the European debt crisis, as the brokerage paid the price for the former Goldman CEO's big, risky bets on sovereign debt.
MY COMMENTS-
The good news is, Corzine walks with millions, whew, I was worried about that, after all liberals really really care, so, it's ok that they walk with mills and investors lose everything.- 1 Reply to z99oo
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(Telegraph)
Andrew Lim, banking analyst at Espirito Santo in London, said: "If Greek voters reject the unpopular bailout plan it could result in a "hard default", which could force banks to take losses of about 75pc on their Greek sovereign bonds, trigger payouts on credit default swap insurance contracts, and raise the threat of a systemic risk.
"If we get a hard default in Greece, it will exacerbate the situation with Italy and Spain. It just increases the problem of Italy going down the same route, and that's the real risk.
Prime Minister George Papandreou announced plans for the referendum in response to riots that followed last week’s proposal, as well as dissent from within his own Socialist party.
He said: “The command of the Greek people will bind us. Do they want to adopt the new deal, or reject it? If the Greek people do not want it, it will not be adopted.”
Staging a referendum, reportedly to be held in January, threatens to throw the eurozone further into crisis as the majority of Greeks object to the bail-out, according to a survey published last week.If Greece were to reject the plan, which requires deep spending cuts, it would risk a full-scale default and possible ejection from the euro. The country could even run out of money to pay civil servants.
MY COMMENTS-
Take a look at the futures and overseas markets guys!!!
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