What is a 'selective default?'
Fifty Euro notes are pictured coming out of an ATM machine in Athens, Greece.
JEREMY HOBSON: Now let's get to what observers are calling a critical make-or-break meeting in Brussels, Belgium. European leaders are poised to sign off on a second bailout for Greece to try and stop the spread of the European debt crisis.
But as Markeptlace's Stephen Beard reports, the package being worked out is likely to send Greece into what's called a selective default.
STEPHEN BEARD: This would take the pressure off the Greek government and may keep investors happy. Holders of Greek government bonds -- whose market value has been more than cut in half -- would get their money back but not for 30 years. The interest rate paid on these new bonds would be lower than current market rates. That's why it's called a selective default. Investors take a bit of a hit but don't lose the bulk of their money.
Stephen Lewis of Monument Securities says the European Central Bank may now be prepared to lend further funds to Greece on this basis.
STEPHEN LEWIS: It's beginning to look as though the ECB is willing to show some flexibility over this after having taken up a very rigid position earlier.
But big questions remain: what investors will make of this plan. And whether it will end the 18-- month long Euro zone debt crisis.
In London I'm Stephen Beard for Marketplace.