No EFSF Expansion - Germany Rejects Bigger Bailout Fund

So much for Steve Liesman's European EFSF rumor that pushed equity markets higher yesterday into the close, as both German finance minister Wolfgang Schaeuble and Merkel spokesman Steffen Seibert are on the wires this morning saying 'no deal' to an expanded, Enron-like, CDO squared SIV bailout.  And in case they weren't stating the case of Germany's opposition clearly enough, the coalition party FDP made it a triple kibosh.

You want more proof that Liesman was overreaching in a blatant attempt to goose markets on unsubstantiated rumors?  Bloomberg reports this moring that the EIB, European Investment Bank, not only has not been approached regarding EFSF expansion, but that it would reject the idea outright if proposed.

Back to the drawing board for Euro bailouts.

WSJ

BERLIN—The German government Tuesday rejected the idea that the European Financial Stability Fund would be expanded beyond what the 17 euro-zone governments agreed upon in July.

Changes to the bailout facility "should look exactly as the plan set out on July 21," said Steffen Seibert, a spokesman for German Chancellor Angela Merkel, adding that the German government doesn't approve of further changes.

--

Wolfgang Schaeuble

Headlines from Bloomberg:

*SCHAEUBLE SAYS INCREASING EFSF WOULD DAMAGE SOME AAA RATINGS

*SCHAEUBLE SAYS WILL ENHANCE EFSF IN MOST EFFICIENT WAY IF MUST

*SCHAEUBLE SAYS MONETARY POLICY `NOT THE WAY' TO SOLVE EURO WOES

*SCHAEUBLE SAYS `NO COMFORTABLE WAY OUT' OF CRISIS FOR EUROPE

*SCHAEUBLE SAYS EVERY STATE MUST PREPARE OWN BANK BACKSTOP PLANS

*SCHAEUBLE SAYS ASKED FOR BANK BACKSTOP PLANS FOR NEXT ECOFIN

*SCHAEUBLE SAYS `WILL NOT SPEND OUR WAY' OUT OF CRISIS

*SCHAEUBLE SAYS `SOLIDARITY HAS LIMITS,' REQUIRES RETURN EFFORTS

*SCHAEUBLE SAYS `IMMEDIATE FISCAL REFORMS ARE OF THE ESSENCE'

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EIB Says Has Not Been Approached Over EFSF Bailouts Plan - Bloomberg

“There have been media reports about a potential involvement of the EIB in a special purpose vehicle in connection with the EFSF, for the purpose of bailouts,” the EIB said today in a statement. “The EIB has not been approached and has no plans to be involved in this. The EIB will continue to focus on its mission which is financing viable investment projects.”

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Related Video:

• Merkel Shuts The Door: "There Will Not Be Eurobonds"

Comments

[DailyBail]

A new California law lets the state collect sales tax from online retailers, with Gov. Jerry Brown saying the move will "create tens of thousands of jobs and inject hundreds of millions of dollars" into the state's ailing economy while leveling "the playing field between online retailers and California's brick-and-mortar businesses."


http://www.activistpost.com/2011/09/online-shoppers-to-pay-california-sales.html

[DailyBail]

A depressed president hooked on Google "vanity searches"

http://www.opinion-maker.org/2011/09/obama-in-the-mirror/#

[DailyBail]

WASHINGTON (AFP) - US Treasury Secretary Timothy Geithner said that Europe has recognized the need to step up its response to the eurozone debt crisis.

"I think this weekend, what you heard is, they heard from everybody around the world," Geithner told ABC News, on Monday.

"They recognized the need to escalate. They're going to have to put a much more powerful financial framework behind this," he said.

http://www.activistpost.com/2011/09/eu-sees-need-to-escalate-crisis.html

Geithner can talk all he wants but Germany is not buying...

[DailyBail]

Dick Cheney's Vancouver visit sparks protest

http://ca.news.yahoo.com/dick-cheney-talk-spurs-vancouver-protest-004327329.html

[DailyBail]

The Mad As Hell Generation: 20 Reasons Why Millions Of Americans Under The Age Of 30 Are Giving Up On The U.S. Economy

http://endoftheamericandream.com/archives/the-mad-as-hell-generation-20-reasons-why-millions-of-americans-under-the-age-of-30-are-giving-up-on-the-u-s-economy

[Dr. Pitchfork]

James Howard Kunstler said it best:

"Europe is a three-card monte game and Greece is the pea and for the moment I'd guess that the pea is under a walnut shell called France."
http://kunstler.com/blog/2011/09/punked-world.html

[DailyBail]

Great read. Thanks Dr. P.

[DailyBail]

Stocks build on rally based on Europe hopes

http://www.marketwatch.com/story/stocks-in-rally-mode-on-europe-hopes-2011-09-27?dist=countdown

[DailyBail]

Merkel confident Germany will support Greece

http://www.marketwatch.com/story/merkel-confident-germany-will-support-greece-2011-09-27

[DailyBail]

Euphoria over Europe may be premature

Reports of expanding EFSF spark global stock rally but analysts urge caution

http://www.marketwatch.com/story/euphoria-over-europe-may-be-premature-2011-09-27