How much of a financial bazooka does Europe need?
Stacey Vanek Smith: European finance ministers are meeting in Denmark today. They’re reportedly adding $670 billion to their bailout fund. Ministers have been trying to figure out how big of a financial bazooka they need to defend Europe from speculators.
From London, Marketplace’s Stephen Beard reports.
Stephen Beard: When speculators began attacking the eurozone two years ago, dumping government bonds, the eurozone’s initial response was widely seen as feeble. They lobbed the equivalent of a couple of grenades. But the battle intensified.
The Europeans wheeled out what they called their ‘big bazooka’ — a multi-billion dollar bailout fund to buy up the beleaguered bonds and blow the speculators away. Now the fund is running low on ammunition. Ministers are talking about creating a much bigger fund.
Here’s Simon Tilford of the Centre for European Reform.
Simon Tilford: If the eurozone doesn’t do anything else to get the southern eurozone economies growing, they will need a very,very big bazooka indeed.
Perhaps, he says, a bailout fund worth as much as $1.5 trillion. Not so much a bazooka as a ballistic missile.
In London, I’m Stephen Beard for Marketplace.
We’re here to help you navigate this changed world and economy.
Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.
In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.
Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.