Friday, 14 May 2010

France threatened to leave the euro

The euro is looking increasingly fragile this morning. According to Le Figaro, a French daily newspaper...
Sarkozy aurait menacé de quitter l'euro
Le président français Nicolas Sarkozy a menacé de sortir la France de l'euro pour forcer l'Allemagne à accepter le sauvetage de la Grèce, a déclaré le chef du gouvernement espagnol José Luis Rodriguez Zapatero, selon des propos rapportés au quotidien El Pais de vendredi. Le journal, proche des socialistes au pouvoir en Espagne, affirme que M. Zapatero a affirmé cela lors d'une réunion mercredi avec des barons de son parti, le Parti socialiste ouvrier espagnol (PSOE) à Madrid.

Which this blog translates as follows...
The French president Nicolas Sarkozy threatened to take France out of the euro in order to force Germany to accept saving the Greeks, the Spanish Prime Minster José Luis Rodriguez Zapatero said, according to El Pais, a Spanish daily newspaper, on Friday. The newspaper, which is close to the ruling socialists, states that Mr Zapatero said this to senior party figures at a meeting in Madrid on Wednesday.
So, it's a bit he said that she said etc, but it looks like Sarky played some major league hardball with the Germans. As mentioned in a previous post, France was in perilous position before the bail out - there's no way the French government could have saved its banking sector if Greece had defaulted.

We may now have reached the beginning of the end for the euro.

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