he crucial question is which way the States looking out of debt. The variants which are currently under discussion, would primarily affect the following groups:
German taxpayers
They are especially affected if the debts are communitarised - for example via euro bonds - or if Germany is pumping too much money into the rescue EFSF and ESM. That makes the state budget at the latest when the federal government must pay higher interest rates. Or when an indebted country goes into bankruptcy and Germany loses his borrowed money. Today are the public authorities of Greece's biggest creditor.
In the event of bankruptcy of the German state would be even a part of the debt, the other people actually wear - for example banks. Because they are considered "systemically important" apply, they have been in the past, often rescued by the states. If they are not already owned by the state. Commerzbank, which had to write because of their Greek bonds about 2.2 billion euros, is still 25 percent owned by the Federal Republic. Even the bathroom nationalized bank HRE had lost with Greek government bonds 2011, around 8.9 billion euros. Ultimately, therefore, the debt come back on to the taxpayers.
The rich German
It is not said that the stresses in the state budget will be borne by all taxpayers. Many want that in this case the rich should pay more. But while many people often are considered "rich", who think nothing of themselves. One possible way would be a forced loan, which has called the German Institute for Economic Research recently. Here, citizens are obliged, with assets of over 250,000 euros to buy German government bonds. Could be about 230 billion euros to Germany on loan from his involuntary creditors in this way, experts have calculated.
By the way: Who has to invest primarily in real estate and stocks comes with inflation still not necessarily them. Historically stood at the end of a great period of inflation is often a so-called "load balancing", in which the less-affected owners of real assets were taxed heavily.
Wealthy Spaniards and Italians
Instead of 'subsidizing Spanish or Italian debt by German forced loans, Spain and Italy could fall into the pockets of their own rich citizens. Because their property is quite large. On the one hand, the Italian State currently has debt of 1960 billion euros, on the other hand, the Italians have a personal fortune of 3737 billion euros - which could be one or the other to extort € so. The situation is similar in Spain: Here a debt mountain of 775 billion euros compares with a personal wealth of 1.857 trillion euros.
Previously put the revenue from property taxes is not as much money in the coffers of the countries in crisis: Taxing the rich is in most states, less than 4 percent of gross domestic product - in Spain is around 1.9 percent, 2 percent in Italy. Since air seems still up. Higher property taxes could also have unintended effects: Who knows a lot of potential, usually as he smuggled abroad on tax evasion. At least as far as the income of the top earners, Spain has already forged ahead. Prime Minister Mariano Rajoy has raised the top tax rate from 45 percent to 52 percent. The French still pursue rigorous plans: President Hollande will unbutton the top earners of more than EUR 1 million annual income three quarters of their salary for State purposes.
All Europeans, if they have financial assets and life insurance
A popular method of over-indebted countries it was in the past, wegzuinflationieren the debt, so pay the debt with freshly printed money. Because more money is in circulation, it loses value. This is good for the borrowers, but bad for the creditors. Therefore, the voices become louder, urging a debt crisis of countries by inflation. Must pay the creditors who now get back less in real money - and indeed in the whole euro area. So far, however, inflation rates in most European countries remain below two percent - though critics say that inflation is currently taking place in assets such as real estate.
An inflation träfe not just people with big money accounts, but also people with pension funds and life insurance companies. Because they have their money in government bonds often - and their value vanishes with high inflation. The social consequences would be serious.
Especially the owners of pension funds and life insurance companies, however, would also be taken if the states would go bankrupt. Because then its indirectly owned government bonds would be worth less directly.

Ex-Foreign Minister Joschka Fischer will be answered in the euro crisis to speak: There is talk of chaos, fire and avalanches. It faced a global economic crisis, as alive today if they had not yet experienced.




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Topics Financial CrisisEuropean UnionEuro crisisJoschka Fischer
In a commentary for the "Süddeutsche Zeitung" criticized the Green Party politician and former Foreign Minister Joschka Fischer, the current European policy.
The European house was "on fire," said Fischer, and Europe. led by Germany, delete "rather than continue with kerosene with water." Europe must summon the courage to set up a fiscal union with a common budget, uniform tax policy and guarantee the debt.
"Europe is now on the edge and is in precisely these fall into the coming months, if not now Germany and France together get them back onto and the courage of a fiscal union and political union of the Euro Group muster," said former Secretary of State.
If the euro fail, the EU will disintegrate. As a consequence, there could be a global economic crisis, as they have not yet experienced the present generations. Greece threatened to descend into chaos.
"And then sets in the run on the banks in Spain, Italy and France will trigger an avalanche that Europe is beneath them." Without the euro, Europe would disappear from the world political stage.
Fischer's conclusion: Germany must opt ​​for the fiscal union. "And that means that Germany is finally the financial survival of the euro zone, with its economic power and its ability to guarantee."

Federal government rejects criticism

The federal government rejected Fischer's criticism back sharply. "Nothing we do is political, focused on the goal of Europe based on the judge, the exact opposite is true," said government spokesman Steffen Seibert.
The federal government strip a very substantial contribution to the development of Europe in the current crisis.

The current bailout of Europe has failed and is not likely to bring about the euro zone out of the crisis. It is therefore inevitable that it will be replaced by another economic concept.
The current rescue package consists of a banking Rekapitalisierungspaket, the euro rescue of the EFSF and ESM, a fiscal pact and an extremely generous monetary policy. Each of these four elements has serious weaknesses.
This requires the Rekapitalisierungspaket that banks increase their capital ratio to nine per cent - giving them an incentive to shrink their balance sheets and thus to award fewer loans and sell the bonds of highly indebted countries. Both are in a crisis is not really helpful.

The support capacity of the EFSF and ESM is not enough to secure greater crisis countries such as Spain and Italy. Due to the insufficient creditworthiness of some countries, the capacity can not currently be extended.
Thus, the proposed fiscal pact will be the Euro countries agree to limit their deficits to a maximum of 0.1 percent of gross domestic product. Only in severe recessions is a deficit ratio of more than three per cent be allowed. Short in combating the recession is hindered, the long-term pact leads to falling public debt ratio, which state investment in education and infrastructure - inhibit - and thus the long-term growth.
Also, the current ECB monetary policy is not sustainable. Because of low interest rates and the almost unlimited liquidity can lead to neglect of risk costs and hence to financial bubbles.
None of the four pillars of the current rescue package can solve the euro crisis sustainably. Therefore, the current system will be replaced sooner or later by a new economic policy construct. Here is not a new solution proposal, seriously, there are only two likely alternatives - and both were primarily from the German perspective is anything but desirable.Euro Bonds have long term serious Fiolgen
One possibility would be the much discussed Euro Bonds. Although in the short term would probably interest the average in the euro area falling overall because the Chinese central bank expected to increasingly buy euro bonds and U.S. government bonds would sell it to diversify their portfolio. These interest rates would, however, obscure the long-term consequences of such a measure, which sooner or later will inevitably come to light.
For the long-term consequences of euro bonds would be serious. The German interest rates would rise significantly and the Greek fall because everyone would pay the average interest rates. In the short term, it would not be noticeable to the German voters likely that changes in interest behind this relationship a gigantic North-South transfers within the euro zone hides - long would this insight does not stop and would bring great tensions within the euro zone with it.
Euro bonds would also generate large misallocations within the euro area, because the interest of a country would be out of proportion to the risk of default. That would weaken the incentive for highly indebted countries to operate finally a responsible fiscal policy, clearly. This highly-indebted countries would continue into debt even higher, which would grow the imbalances between creditor and debtor countries continue -. Until the next, even bigger crisisInflation would be a black future
The second alternative is inflation. The more, the euro area has relied on the European Central Bank (ECB) to stabilize its financial markets, the less the ECB is able to devote themselves to the fight against inflation. Sooner or later, the point will come when the ECB is caught in a conflict and either raise interest rates in order to combat an inflation flare up, or keep interest rates low in order to keep the European financial markets stable. When the financial markets recognize this conflict, it is the ECB have hard to get inflation expectations under control. You could then become a self-fulfilling prophecy.
Both scenarios would mean for Europe, a black future. To avoid these alternatives, Europe must rethink and say goodbye to conventional approaches. A simple four-point plan could make an important contribution to securing the future of Europe.
First Europe needs a "breathing fiscal rule". After a particularly serious problem in the current Fiscal Pact, is that it requires indebted countries to launch massive austerity programs. The countries are already in an economic depression - as currently Greece, Portugal, Italy and Spain. And the austerity programs exacerbate the crisis and thus lead to the opposite of what they really want to achieve: as a result of the economic downturn, falling tax revenues - and transfers rise. This in turn increases the national debt, which creates new demands for austerity measures that exacerbate the economic crisis again. This creates a vicious circle. Therefore, it is necessary to allow recession-affected countries, to stimulate the economy through government spending and tax cuts.
A breathing fiscal rule would allow exactly that: Every country in the euro zone should include a fiscal rule in its constitution, which provides for long-term debt ratio of more than 60 percent of gross domestic product and about how quickly this will be achieved. At the same time must be defined as strongly anti-cyclical fiscal policy should be. This would ensure that an expansionary fiscal policy during recessions also attracts a restrictive fiscal policy in boom times by himself.
Second It must solvency criteria for EU countries are defined. For this, the ECB establish transparent, accountable and publicly communicated criteria. In the event of insolvency of the affected country would go through an orderly bankruptcy and should get in this time, no money by the ECB. Financial contagion would be banned, as other euro countries under its fiscal rules could meet the solvency criteria.
Third The European Commission should use its funds in order to support growth through targeted investments in countries with current account deficits. This could also be used by the European Investment Bank. With such a growth pact, the EU Commission could ensure greater competitiveness in weaker euro-member countries.
4th It must be ensured that large financial institutions whose failure would create macroeconomic problems and mean as a threat to state solvency would not be able to fail. Under the current system, these institutions can be sure to keep their profits in good times to be able to, while large losses are absorbed by the government in bad times. This leads to excessive risk-generated - finally have these financial institutions do not carry their own risk costs.
To solve this problem, new incentives. One possibility would be to require such institutions to include their debt in the form of convertible bonds. Once minimum capital requirements are no longer met, the bonds would automatically be converted into shares - balance sheet considered, so debt would be transformed into equity.
This simple measure would have important implications might not excessive debt because the bonds convert into shares if the capital ratio falls too much. Thus, the capital requirements would have been met. The cost of debt and the associated risks would be borne by the shareholders and no longer have to be borne by taxpayers. Thus the institutions would avoid even a strong incentive to excessive debt - because the shareholders would put pressure on the management to avoid excessive debt, because the conversion of bonds into shares would result in a dilution of the value of existing shares by itself.
Such a four-point plan had the potential to solve the euro crisis and the euro area to sustainably breathe new growth. You just have to want it. All that is necessary for the implementation of this plan is a portion of political will - and above all courage to say goodbye to conventional ways of thinking. This is not the moment yet.

Strongly urge CSU politician on a Euro exit of Greece, now the chancellor speaks a word of power, and warns of cross-shots. Europe is currently in a very crucial stage of fighting the euro crisis, Angela Merkel said on ARD. "Everyone should weigh the very words."Info
Berlin - German Chancellor Angela Merkel called the black-yellow coalition, not the euro debate continues to heat up. "We are currently in a very crucial stage in the fight against the euro debt crisis and so I do think we should all weigh our words," Merkel said on Sunday the ARD "report from Berlin." This move reflected statements of CSU General Secretary Alexander Dobrindt a euro zone without Athens.
DISPLAYDobrindt had before the "Bild am Sonntag" said a withdrawal of Greece from the euro zone, in his view there is no way lead. "I see Greece in 2013 outside the euro zone." In recent weeks, CSU politicians had repeatedly issued the watchword Greece should get out of the currency union. Vice Chancellor Philipp Rösler (FDP) and Union parliamentary leader Volker Kauder (CDU) had declared an exit of Greece from the currency zone if necessary manageable.
On Friday Merkel had assured after talks with Greek Prime Minister Antonis Samaras, she wanted to stay in the country of the euro zone. "We have mutual responsibilities in Europe," declared the Chancellor. She recalled the "huge cuts" that could cope with the Greeks currently.
Praise for Samaras
It currently counts every day in the implementation of the agreed savings and reform efforts, the chancellor added. Could fall a decision to continue dealing with Greece yet: "I look at it at the Troika report and then review things," said Merkel. The report of the experts from the European Central Bank ECB, the International Monetary Fund and the European Commission is expected in September or October.
Merkel explicitly praised in the interview the new Greek Prime Minister Antonis Samaras: "I have the impression that he puts his mind seriously." At the same time, the German leader lamented the unequal distribution of the loads in Greece. "This is unjust, too, that those who have a lot of money, are long gone and have invested their money elsewhere, and the common people have to pay for these things in many places now -.. And this is extremely annoying" Unfortunately, this was during the financial crisis always the case.
The criticism from the ranks of their own party, they will calmly: "That would be a strange People's Party, if there would never be criticism." A People's Party drawing but also the fact that "everybody can not prevail at all times to one hundred percent." As party leader, they see it as their task to bring together the various ideas again and again - "in a way that is good for the country and the people in the country".
DISPLAYThe CDU was recently re-intensified criticism of Merkel's leadership style has become noisy. The head of the CDU / CSU Business Association Josef Schlarmann (CDU), has accused her abzudrängen potential successors, quiet the party with a "wellness program" and stifle fundamental debates. The so-called "Berlin Circle" looks under Merkel's conservative CDU profile neglected. The announced last week published a manifesto of the circle, however, was officially canceled due to scheduling reasons.
On equality for same-sex marriage, Merkel expressed skepticism: "I believe that we are doing well at this point on it, but the law again to be seen." Politically, their conviction is that "it is good that marriage and family are still found something much better." They are constitutionally protected for good reason.
Whether the legal equality of homosexual couples "in a tax must end in full equality of marriage, I'm doubting myself," said the Chancellor. They also know that Karlsruhe asked this question last often defined differently.

The response of the new French president Francois Hollande on this issue just seemed the motto cost growth, it what it may. What is your opinion?
Italy's position was always for more growth, but against the idea of ​​growth at the expense of fiscal discipline. But after the elections, the French position is approximated to that of Germany and Italy.
So what was your role at the last summit in Brussels?
We had, in my view one hand to do something for the growth, on the other hand fighting around the main obstacles to growth, namely the instability of the markets. Imagine if we had said at the final conference, let us be as agreed on the growth package, but we have no solution to the instability of the monetary union. Under these circumstances, even the Growth Pact would have been interpreted as a renewed glow solution without major effects on markets and the economy. When I - as well as the Spaniards - have said that I saw myself not able alone to approve the growth pact because we needed an agreement on short-term instruments for stable finances, delayed course, the adoption of the Growth Pact by half a day. But that we have received unanimous support for a package of two issues: growth and stability.
So how is your assessment of the summit?
It is a compelling package was agreed in the interest of the monetary union and the European Union. The proof of this is that it in the markets on Friday said that at least this time I chose a summit more than expected. Germany and Italy have acted consistently and have both contributed to a European progress.
So how is your relationship with Chancellor Angela Merkel?
My government has since the beginning of the term always had the support of Chancellor Merkel and Finance Minister Wolfgang Schäuble, for which I am very grateful. Even though we have not always expressed in the same way, I am also thankful that we receive from our German partners recognized for our restructuring efforts. At the same time it also acknowledges that our efforts are hampered in part from the fact that the risk premium on Italian government securities is so high. Finally, we also share a lot of views. Not for nothing I would personally in Italy often seen as "very German".

Professor Monti, the Italian media bordered on the semi-final of the European Football Championships and after the European summit in Brussels, the results in a concise formula: Mario against Angela two to zero. Share this judgment?
At least the one-to-zero referring to another Mario Balotelli's last name. Sure to love the media simple images from the sports competition. But what Brussels is concerned, I would be the whole thing, if any sum, rather this way: Angela plus Mario is equal to a step forward for European economic policy. In the past few months now, the German and Italian governments are working with the various peaks in mind that the European Union sets out on a path of growth, at the same time includes the observance of financial discipline with.
From the summit in Brussels, however, reported Italian pressures that you wanted a mechanism to reduce the risk premium on government securities. Inventory risk so that the summit broke up without any tangible results?
What the outside it seemed like the use of a veto and change has led to discussion, is actually not a revolution, but rather a classic method of negotiation. If we want to decide a complex set of measures, such as the recent summit, there is no final agreement, as long as no agreement was reached on all points. That at the last summit something had to be done for the growth and financial stability, there was beautiful summarized in the foreword to the draft summit decision: The crisis surrounding the sovereign debt and the weakness of the financial sector to slow the economic recovery and create risks to the stability of the Monetary Union - this creates unemployment and reduce Europe's chances of participation in the international economic recovery.

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Lessons from the crisis

According to Euro-report offered protection against the common currency turbulence in interest and exchange rates.

The financial crisis has catapulted the 16 countries of the euro zone in its first recession since the single currency 10 years ago. After massive cash injections by governments seems their economies recover overall a bit, but the future is anything but predictable.

The report on the euro-zone called the future challenges and calls for a broader economic policy coordination and more financial supervision to support the recovery. Furthermore, the governments recommend their finances well to keep in mind, as many of them have received the generous cash injections large loans.

Statement and Report 2009 on the Euro-zone