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By Beverly Chandler, Opalesque London:
Calling on the classics seems appropriate for a description of a problem that largely stems from Greece. Stuart Thomson, chief economist at Ignis Asset Management, described the Euro agreement as "a pyrrhic victory for Germany and the ECB. Germany was unwilling to fund the periphery without a substantial degree of economic control over the fiscal policies of its southern neighbours and has insisted that European treaties need to be changed. These treaty changes are fraught with political pitfalls and will require referendums in Germany, France, Holland, Finland and the UK."
Chris Wyllie at Iveagh Private Investment House regarded the agreement as a jumbo sticking plaster and "not the big bazooka it needs. It looks like a victory for the German parsimony. No hard cash and the size of the EFSF expansion at the bottom end of expectations. As far as we know at this stage, there is no new mandate for the ECB."
Pimco’s chief executive and co-chief investment officer, Mohamed El-Erian, writing for FT.com believes that the agreement is an important step but that the devil lies in the detail and that two major issues need to be sorted.
"Europe desperately needs an effective plan to boost employment and promote inclusive economic growth. Without this, it will be virtually impossible to stabilise the ...................... To view our full article Click here
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