22nd Apr - Weekender: France & IMF

Recapitalizing the recapitaliser - or how European countries give money to IMF so that it would save European countries. French elections - playing both the right and the left side simultaneously and promising everything without proper plans. If I were you, I would only read the summaries on France, but for the IMF stuff... I am not sure! The amounts were as expected, but no sign of where and how the money would be used. At least it is outside the politicians' and eurocrats' control.


This is good, as getting anything done in Europe first means giving the decision making over to someone else. The IMF fits the bill nicely, but it cannot recapitalize the Spanish banks. That is something that has to be done with the "Death Star" - the EFSF/ESM. The IMF money is basically an external backstop. Should a country slip outside the private markets and get a haircut treatment, the immediate funding needs can be accommodated by the IMF. All in all, I believe the whole point of getting the IMF involved in this was circumventing the national parliaments. Now all the eurocrats  need to do is figure out a way of using these undemocratically acquired guarantees to bail out more bankers. They have plenty of advisers. Don't worry, they will come up with something eventually.

FRENCH ELECTIONS

Why you should care about the French election – Wonkblog / WP

The big difference is that Hollande is calling for an open renegotiation of what he calls the “Merkozy pact,” which urges each euro zone country to adopt a balanced budget amendment into their constitutions. Sarkozy doesn’t go this far because he’s a party to that pact. But underneath it all, they both agree that something needs to change in Europe.

France’s presidential election: The anti-Sarkozy vote – The Economist

All the signs point to a win for the Socialist François Hollande, chiefly because he is the anti-Sarkozy candidate

Does France want a normal president? – The World / FT

But Hollande seems to be rather skilfully turning his lack of charisma into an electoral asset. Tonight he described himself as a “normal candidate for a normal presidency”. Normally, this stress on normalcy would be rather underwhelming. But Hollande is playing on a widespread sense that the French people are fed up with the twitchy, weirdness of Sarkozy.

What a Hollande Victory Would Mean for Merkel – Spiegel

German Chancellor Merkel has made it clear that she would like to see French President Nicolas Sarkozy win a second term. Indeed, if his challenger François Hollande emerges victorious in the country's upcoming election, she could face isolation in Europe. But a Sarkozy re-election might be problematic, too.

Brussels to breathe sigh of relief after French vote – euobserver

According to diplomats, once the next president of the fifth Republic is installed, talks on issues such as the EU's multi-annual budget and tweaking the rules on EU borders will begin in earnest.

Paris – City of Dimmed Lights? – Mish’s

Steen Jakobsen: I asked for my taxi driver’s political opinions on my trip to Paris, and he practically shouts back: “Promissez, promissezz – eet’s all just promissez”.

The French Presidential Election Is Underway – ZH

Very nice collection of articles and analysis from several sources

BizDaily: In the Balance: France – BBC (mp3)

France is famous for its lifestyle, but is its social model sustainable? Justin Rowlatt and his guests Brigitte Granville, Yannick Nuad and Simon Tilford discuss the biggest issue in this weekend's presidential election .. l'economie, stupide
 

IMF’S EUROPEAN “FIREWALL”

G20 doubles IMF's war chest amid fears on Europe – Reuters

Leading world economies on Friday pledged $430 billion in new funding for the International Monetary Fund, more than doubling its lending power in a bid to protect the global economy from the euro-zone debt crisis.

Weekly Firewall Edition – TF Market Advisors

The politicians expect the markets to be excited about this “heroic” effort and the guarantee that no debt problem is too big that it can’t be solved with more debt…How will the countries honor their commitments? Where will the money come from, especially the European portion? How would the money be used, for countries, for banks? If commitments made in 2010 haven’t been approved, what good are these commitments? What does this do to help the countries that are in trouble? Why does the IMF think it is safe to lend when real investors won’t lend?

IMF crisis funds: Why nobody really cares – MacroScope / Reuters

The worst of it is, the market’s confidence in the likelihood of an eventual government bailout has become so deeply embedded that for some analysts, the figure is totally fungible.

Europe Urged to Quell Crisis as IMF Wins $430 Billion Boost – BB
G20 doubles IMF's war chest amid fears on Europe – Reuters

Schaeuble Says Europe ‘No Longer the Focus’ at IMF Meeting – BB

Statement by Mr. Olli Rehn, Vice President, European Commission – IMF (pdf)

Statement by Wolfgang Schäuble, Federal Minister of Finance, Germany – IMF (pdf)

Statement by Eveline Widmer-Schlumpf, Minister of Finance, Switzerland – IMF (pdf)

Statement by Timothy F. Geithner, Secretary of the Treasury, United States – IMF (pdf)

Transcript of the G24 Press Briefing – IMF

Transcript of the G-20 and IMFC Joint Press Briefing – IMF

Europe Urged to Fix Crisis as G-20 Warns of More Stress – BB