The German parliament decided to help Greece one more time. Experts say this is the last chance for Greece. They say it is not about saving Greece, it’s about getting a timeout and reducing the pressure on the entire eurozone as a Greek default would eventually make the common Euro currency collapse.
During the meeting the parliament decided to expand the EFSF’s authority and to increase the size of financial security from €440B up to €780B.
These decisions were hard to make for the German parliament because the destiny of the entire global economy depended on the voting results. Germany’s share in the EFSF is now about 30%.
During the recent TV appeal Angela Merkel called on the German nation to support the common currency, to save it from falling into the abyss by allowing the German authorities to allocate the required substantial amount of money from the country’s budget. However, there is no unity on the matter even inside the ruling party. Some politicians assume that such a substantial increase in the EFSF is nothing but a waste of money. Numerous opinion polls also confirm that German taxpayers do not support spending their money on somebody else’s problems.
Even Angela Merkel herself doesn’t deny that this is a rather risky idea because in the worst case the money will be wasted. However, she is convinced that it is necessary to do one’s best to preserve the integrity of the eurozone.
Angela Merkel’s win may turn out to be the beginning of a defeat as the Greek problem is not the only one. Italy and Spain are the next eurozone members in the “we need more money” line. Yet they need much more money to survive – trillions of euro.
Most experts are puzzled – a Greek default may cause the “domino effect”. So they say that the wisest way out is to expel Greece from the eurozone. However, so far there have been no precedents of a country leaving the eurozone, so nobody knows for sure what it may end up with.
According to the Department of Market Volume Analysis, , at this point the current EUR futures contract (6ЕZ1) is recovering from last week’s decline. It has reached the level 1.3450, which is a major volume cluster (20200 lots of trading volume).
