Merkel to Europe - "Prepare to Cede Sovereignty"
by Tyler Durden
April 22, 2013
The liquidity tsunami that started in
September of 2012 in the Marriner Eccles building and continued with the
BOJ's own epic QEasing expansion three weeks ago, has so far provided
the impetus for Europe to kick the can of its inevitable
dissolution for a few more months.
Yet slowly but surely the market is starting
to read through the artificial levels implied by Italian and Spanish
bonds, driven by recycled ECB funding via bank and repo conduits and of
course Japanese carry cash, and rumblings of a return to crisis
conditions are back.
And as always happens, once the crisis talk
is back, so is discussion of a fiscal union.
Sure enough, earlier today Germany's Angela
Merkel once again reminded everyone just what the stakes are in order to
achieve a truly stable, and sustainable European union:
nothing short of ceding sovereignty to
And with that we are back to square one,
because that has always been the trade off - want a unified, fiscally
and monetarily, Europe? You can get it: just bow down to Merkel.
Chancellor Angela Merkel said on Monday that Eurozone members must
be prepared to cede control over certain policy domains to European
institutions if the bloc is truly to overcome its debt crisis and
win back foreign investors.
Speaking at an event hosted by Deutsche
Bank in Berlin alongside Polish Prime Minister Donald Tusk, Merkel
also defended her approach to the crisis against critics who argue
she has put too much emphasis on austerity, saying Europe must find
a way to deliver both growth and solid finances.
The comments came two months before
European leaders are due to gather in Brussels to discuss moving
towards a so-called "fiscal union".
seem to find common solutions when we are staring over the abyss,"
Merkel said. "But as soon as the pressure eases, people say they
want to go their own way."
"We need to be ready to accept that
Europe has the last word in certain areas. Otherwise we won't be
able to continue to build Europe," she added.
Two conclusions here:
This is confirmed by the immediate denial of
precisely this, adding "it would be
"dangerous" if other countries in Europe felt Germany was imposing its
own economic model across the entire bloc."
Oh, ok then.
So just what is Germany's vision for
"We don't always need to give up
national practices but we need to be compatible," Merkel said. "It
is chaos right now."
"We need to be prepared to break with
the past in order to leap forward. I'm ready to do this," she said.
So... just give up national practices
And yes, Merkel is of course ready to head
the asset-stripmined continent.
The question is who else in Europe
is willing to hand over their liberties to the next iteration of the