TEXT OF INTERVIEW
STEVE CHIOTAKIS: President Obama has landed in Japan for his second economic summit of the week. He flew in from South Korea after wrapping up the G20. As he closed that meeting, the president said the global economic picture is brightening, but still has a ways to go.
BARACK OBAMA: This decision was not one designed to have an impact on the currency, on the dollar. It was designed to grow the economy.
But Mr. Obama and the other leaders of the world’s 20 wealthiest nations ended up talking a lot about the debt problems of a small, distant European economy. Ireland. Investors are worried that the Irish government may not be able to pay back all of its debt.
Marketplace’s Stephen Beard is with us from London to talk about it. Good Morning Stephen.
STEPHEN BEARD: Hello Steve.
CHIOTAKIS: So how is it that Ireland, of all places, has become the hot topic?
BEARD: Well because it’s beginning to look like a rerun of the European debt crisis. Earlier this year it was Greece that everyone was fretting about, now it’s the Irish. And the question is, will Ireland have to be bailed out like the Greeks? What’s really rattled investors is Germany’s instances that it shouldn’t be tax payers alone that pick up the tab for these problems. Holders of government bonds should suffer too. And that’s convinced investors they shouldn’t wait around to find out how much suffering their in for. They’re bailing out now.
CHIOTAKIS: Now this is spreading, Stephen, to investors around the world?
BEARD: Yes. Investors have been dumping bonds in other heavily indebted European countries like Portugal and Spain and that’s hit the Euro. And that’s had an ironic effect — it’s balanced the dollar. Just as the U.S. was getting all that flack at the G20 meeting for driving the greenback down by printing more money. Here’s Neil MacKinnon is with VTB Capita group.
NEIL MACKINNON: The dollar is actually stabilizing. It’s the Euro that’s is in the spotlight and under pressure because of you might consider as round two of the Eurozone debt crisis.
The decline of the Euro of course is great for Germany who triggered this sell off. A cheaper Euro will make German exports cheaper, not so good for U.S. exporters though. Higher dollars make U.S. exports more expense.
CHIOTAKIS: Alright Marketplace’s Stephen Beard in London, Stephen thank you.
BEARD: OK Steve.