No End in Sight for Greek Bailout Talks
President Obama says Euro zone crisis is endangering nation’s economy
The "troika" composed of the European Union, International Monetary Fund and European Central Bank have been engaged in discussions since last week regarding the rescue package for Greece but no final decisions have been consummated until now.
However, an official of the IMF disclosed that the latest appraisal on the funding assistance would be concluded soon.
Negotiations are expected to recommence on Friday.
Meanwhile, a report from Reuters said that U.S. President Barack Obama called on European nations to move quickly to deal with the sovereign debt crisis that hounds the global financial system.
If the bailout funds are not released within the next few weeks, Greece may face cash shortage next month triggering a default and plunging the euro zone into grave conditions. Financial markets worldwide have already been adversely affected by this situation.
An encouraging development is the decision of the Dutch legislature to vote in favor of a modified euro zone bailout plan, leaving Malta and Slovakia as the only member-nations that have not officially given their affirmation on changes made last July.
Legislators from the lower house voted 96 to 64 in favor of strengthening the European Financial Stability Facility (EFSF).
Reuters mentioned that the ECB has let down investors by leaving rates untouched at 1.5 percent notwithstanding indications of a strong deceleration of the European economy although it tried to atone for this by drafting measures to improve liquidity.
German Chancellor Angela Merkel stated that Europe should not be indecisive in recapitalizing its banks if this would avert greater economic damage.
ECB President Jean-Claude Trichet, who is set to retire, stated that the central bank will provide unlimited one-year funding in two operations and restore its policy of covered bonds for up to 40 billion euro.
U.S. Treasury Secretary Timothy Geithner said the essential necessity is to make sure those governments and financial systems under pressure should have access to a more powerful financial backstop.
Jean-Claude Juncker, chairman of euro zone finance ministers, said "banks in need of capital should turn first to the markets, then to national governments and as a last resort to the euro zone's rescue fund."