Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Euro Impact on Gold, USD ... -- Ignore unavailable to you. Want to Upgrade?

To: banco$ who wrote (156)	12/23/1998 8:20:00 PM
From: banco$	Read Replies (1) \| Respond to of 289

"..Mr Duisenberg said one of the ECB's "greatest worries" was the failure of almost all member governments to make progress towards balancing their budgets, meaning they would have no room for manoeuvre in hard times. They would not be able to alleviate hardship during a slump because they would already be borrowing the maximum allowable under the Stability Pact, three per cent of gross national product. Members of the euro will no longer be able to resuscitate their economies by cutting interest rates or devaluing the currency, having lost that power to the ECB. If they cannot spend more money either, then they are liable to face mounting anger from their voters and mounting pressure to borrow excessive amounts regardless of the implications for the stability of the euro. Mr Duisenberg cannot stop this because the bank has "no influence over economic policy, we can only give our opinion loud and clear and repeat it until people believe us". He is therefore anxious to ensure that the ECB speaks with one voice, a task experts believe will be greatly complicated by the fact that while the bank furnishes six members of its Governing Council, including Mr Duisenberg himself, the other 11 are the heads of the national central banks of the euro members." (Euro bank 'will fight to block rates cut,' By Andrew Gimson in Frankfurt) telegraph.co.uk