Marketplace Index for Monday, December 5, 2011
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German Chancellor Angela Merkel and French President Nicolas Sarkozy took a pretty dramatic and united step forward today. They jointly pushed for a new European treaty that, if ratified, would alter the actually treaty that created the euro zone. It will create a system of budget cops to enforce automatic penalties onnations running deficits greater than 3 percent of their total budget. Consider yourself on notice, Greece, Portugal, Ireland, Italy, and Spain. Even though it's still in the planning stages, the European Central Bank could lower interest rates when it meets Thursday.
Posted In: Eurozone, treaty
France and Germany are finally on the same page, both saying they want to modify the treaty that originally created the eurozone. A key element automatically penalizes countries if budget deficits run too high. Hence, the world of the day: Automaticity.