It seems that the European debt crisis is not soon to go away as European leaders are forced to announce yet another summit in the coming week after Germany and France deadlock politically.
Elysee Palace released a statement in which they state that Angela Merkel and President Sarkozy will discuss their response to the crisis which is said to be both comprehensive and ambitions. This meeting is to take place prior to the summit scheduled for Sunday.
Even so, the two powers admit that there is a separation between them as to how to resolve the debt crisis facing Europe but they do claim that a resolution will be reached. They have a target date no later than Wednesday when a second meeting/summit is planned.
According to inside information, the plug was almost pulled on the weekend meeting and the only ‘salvation’ was that the French president called Mrs. Merkel and literally begged her not to cancel the talks. Oddly, this news was leaked just as the US president was praising their efforts to ‘work together,’ calling their efforts diligent and politically sustainable.
The unfortunate result of the delay and the calling of a second summit is that financiers and politicians from around the world have been counting on decisive action and this further delay is causing them some amount of consternation.
Even so, Mrs. Merkel and French President Sarkozy do agree that they have a well defined solution in a ‘three-pronged plan.’ This plan entails expanding the part the EFSF will play in the crisis, the recapitalisation of European banks and they intend to further strengthen the integration of European economies.
In the end, Prime Minister Brown admitted that European banks had broken their promise to recapitalise as they had pledged and are in a much worse state of affairs than the United States’ banks. It is his feeling this is due to the fact that toxic assets weren’t written off, they are not writing new loans and they have tried to conceal the amount of problems they are up against. These are all things which will need to be sorted before stability in the region can be achieved.