Germany and France Unite To Help Greece

by San Antonio Attorney

European markets had been beaten within the past few days due to the issue on Greece and then suddenly news reports about a deal between Sarkozy and Merkel came up.

Investors are concerned that Greek Prime Minister George Papandreou is not going to get parliamentary endorsement for another austerity cuts in order to lower his country’s enormous funds shortage. Aside from that, the Europeans are also in disagreement if they should provide additional emergency assistance to Athens.

The confidence of investors has also been shaken by the massive public protests in Athens in resistance to the austerity package.

Papandreou replaced his finance minister with an influential Socialist party colleague during the Cabinet reshuffle on Friday. According to analysts, the newly appointed finance minister can deliver the much needed votes in Parliament.

Papandreou is going to show his most recent group of ministers for a vote in Parliament confidence next week.

Merkel seemed to back away from her firmness that Greek private debt holders need to take part in a second bailout of their nation by stretching their bonds’ maturities. A lot of Germans think that those investors should take responsibilities in the current situation while Athens depends on taxpayers to be rescued.

However, the European Central Bank has taken firm opposition of the idea because the rating agencies might view the required participation as similar to Greece’s default. That could set-off a global financial crisis.

Sarkozy and Merkel arranged a “gentler” alternative designed to see private bondholders get involved voluntarily – for instance, by keeping their exposure to debt on Greece after their existing bonds mature.

The deal between French President Nicolas Sarkozy and German Chancellor Angela Merkel, the two most power nations in the European Union, can help Greece in getting a new bailout package from EU in July.

A country such as Greece may get a bail out from other countries, but individual in the United States are not likely.  If you are having issues paying your bills, and debt has piled up.  Consider a San Antonio Bankruptcy for debt relief.

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