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Friday, July 06, 2012 11:34 AM

Finland Threatens to Leave Euro Rather Than Pay Debts of Others; Eight Things To Remember

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The Independent reports Finland warns of euro exit rather than pay debts of others

FINLAND would consider leaving the eurozone rather than paying the debts of other countries in the currency bloc, Finnish Finance Minister Jutta Urpilainen has said.

In a newspaper interview today she said she'd consider crashing her AAA-rated country out of the eurozone.

“Finland is committed to being a member of the eurozone, and we think that the euro is useful for Finland. Finland will not hang itself to the euro at any cost and we are prepared for all scenarios.

“Collective responsibility for other countries' debt, economics and risks; this is not what we should be prepared for. We are constructive and want to solve the crisis, but not on any terms,” she said.

Meanwhile, eurozone officials are cautioning against expecting any quick action from the currency bloc's finance ministers when they meet on Monday to sort out the tangle of loose ends and disagreements left by last month's EU debt-crisis summit.

Time-frames may already be slipping and opposition is building in euro zone hardliners the Netherlands and Finland.

"You have a Finnish problem. You have a Dutch problem. You have a German problem too," said one euro zone diplomat, ..."I don't see a package done by Monday."
Eight Things To Remember

  1. The ESM is supposed to be in place by July 9th. Think that's going to happen?
  2. There have been 19 summits to date. Here It Comes Your 19th Euro Breakdown
  3. Germany has still not ratified the ESM because it is under constitutional review (see German Supreme Court Delays ESM; Another Setback for Merkel; Creeping Bailouts; Reflections on German Expectations for details)
  4. The CSU (Merkel's coalition partner), has threatened to sink the Coalition if Merkel gives any more ground. (See Merkel's Coalition About to Splinter Over Creation of "European Monster State".)
  5. A "Third Front" is forming against Merkel (See German Central Bank Head Warns Merkel on Repeated Weakening of Positions; Third Front Against Merkel
  6. The rise of the Five Star Movement suggests Italy may leave the eurozone. (See Time-Lapse Interactive Graph Shows Stunning Rise in Anti-Euro Sentiment in Italy)
  7. No currency union in history has ever survived without a fiscal union as well.
  8. It's Just Impossible!

Four Reasons It's Impossible

  1. The Bundesbank said there should be no banking union until there is a fiscal union.
  2. Angela Merkel said that there should be no fiscal union until there is political union.
  3. François Hollande said that there should be no political union until there is a banking union.
  4. The German supreme court will not allow a political union nor a fiscal union, nor a banking union without a German referendum.

Mike "Mish" Shedlock
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