Opinion

Paul Taylor

Analysis: Euro zone ponders best path to “GEMU”

Paul Taylor
Oct 29, 2012 05:58 UTC

PARIS (Reuters) – In the rich lexicon of Brussels acronyms, a new treasure has entered the vocabulary since June: GEMU.

It stands for Genuine Economic and Monetary Union, a term used in the conclusions of the last two European Union summits in a tacit acknowledgement that the single currency created by the 1992 Maastricht Treaty was flawed and woefully incomplete.

It also signals that Europe’s leaders are starting to shift their focus from fingers-in-the-dike crisis management to save the euro to a longer-term process of building a more robust, storm-resistant architecture for the currency area.

The aim is to bolt onto the existing governance structures more binding fiscal discipline, common banking supervision and resolution, more effective economic policy coordination and greater democratic oversight of euro zone policymaking.

The battle over the nature of a revamped GEMU will be a long and incremental affair.

EU faces two tough months of bargaining to boost euro confidence

Paul Taylor
Oct 21, 2012 22:32 UTC

PARIS (Reuters) – European Union leaders face two months of tough bargaining on money, power and the future governance of the euro zone before they can boost confidence that the existential threat to the single currency has faded.

The European Central Bank’s pledge to buy the bonds of struggling euro zone countries in unlimited amounts has changed the terms of Europe’s debt crisis.

Yet French President Francois Hollande may have been a little premature in declaring a turning point last week after another night of summit negotiation yielded a deal for a euro zone banking regulator to be launched next year.

Analysis: Europe’s separatists gain ground in crisis

Paul Taylor
Oct 15, 2012 16:45 UTC

PARIS/BRUSSELS (Reuters) – From the Pyrennean pastures of Catalonia to the heathery highlands of Scotland, separatists are gaining ground as Europe’s economic crisis deepens, but this does not necessarily mean there will be more national flags on the map.

Flemish nationalists scored sweeping gains in Belgian local elections on Sunday, Scotland agreed terms on Monday for a 2014 referendum on independence from Britain, and Catalan separatists expect a regional election next month to advance their cause.

Just as nation states are ceding more power over budgets and economic policy to the European Union, regional grievances and conflicts that have simmered for centuries have taken on new intensity in fights over a shrinking pie of public money.

Europe’s separatists gain ground in crisis

Paul Taylor
Oct 15, 2012 16:41 UTC

PARIS/BRUSSELS (Reuters) – From the Pyrennean pastures of Catalonia to the heathery highlands of Scotland, separatists are gaining ground as Europe’s economic crisis deepens, but this does not necessarily mean there will be more national flags on the map.

Flemish nationalists scored sweeping gains in Belgian local elections on Sunday, Scotland agreed terms on Monday for a 2014 referendum on independence from Britain, and Catalan separatists expect a regional election next month to advance their cause.

Just as nation states are ceding more power over budgets and economic policy to the European Union, regional grievances and conflicts that have simmered for centuries have taken on new intensity in fights over a shrinking pie of public money.

Nobel-crowned EU risks future as loveless marriage

Paul Taylor
Oct 15, 2012 06:35 UTC

PARIS (Reuters) – The European Union’s Nobel peace prize comes just as a realisation is dawning that Europe’s single currency – the EU’s most ambitious project – has survived three years of incessant financial turmoil and is not going to break up.

But having narrowly avoided an acrimonious divorce and the loss of some of its errant children, the euro zone risks a future as an unequal, loveless marriage with frequent rows and the prospect of separate bedrooms.

Two things have become clearer in the last few weeks that were widely disputed before: contrary to prevailing opinion earlier this year, the euro is here to stay and could very probably keep all 17 members and add more in future.

Analysis: Nobel-crowned EU risks future as loveless marriage

Paul Taylor
Oct 15, 2012 06:32 UTC

PARIS (Reuters) – The European Union’s Nobel peace prize comes just as a realization is dawning that Europe’s single currency – the EU’s most ambitious project – has survived three years of incessant financial turmoil and is not going to break up.

But having narrowly avoided an acrimonious divorce and the loss of some of its errant children, the euro zone risks a future as an unequal, loveless marriage with frequent rows and the prospect of separate bedrooms.

Two things have become clearer in the last few weeks that were widely disputed before: contrary to prevailing opinion earlier this year, the euro is here to stay and could very probably keep all 17 members and add more in future.

Nobel prize may restore EU’s lost sense of purpose

Paul Taylor
Oct 12, 2012 16:24 UTC

BRUSSELS (Reuters) – Winning the Nobel peace prize is a huge morale boost for an organisation that has only recently had a near-death experience and is still not entirely sure it is out of danger.

By highlighting the European Union’s central achievement of securing peace on a war-scarred continent, the Nobel judges may give the 27-nation bloc back a sense of purpose that its day-to-day practitioners often seem to have lost.

The EU is still a magnet of hope and prosperity for emerging democracies in eastern Europe and the Balkans, but it is unloved by ordinary Europeans, whose sense of belonging remains national or local rather than European.

Analysis: Nobel prize may restore EU’s lost sense of purpose

Paul Taylor
Oct 12, 2012 15:56 UTC

BRUSSELS (Reuters) – Winning the Nobel peace prize is a huge morale boost for an organization that has only recently had a near-death experience and is still not entirely sure it is out of danger.

By highlighting the European Union’s central achievement of securing peace on a war-scarred continent, the Nobel judges may give the 27-nation bloc back a sense of purpose that its day-to-day practitioners often seem to have lost.

The EU is still a magnet of hope and prosperity for emerging democracies in eastern Europe and the Balkans, but it is unloved by ordinary Europeans, whose sense of belonging remains national or local rather than European.

Exclusive: Euro zone considering bond insurance for Spain – sources

Paul Taylor
Oct 4, 2012 11:52 UTC

MADRID/PARIS (Reuters) – The euro zone is considering aiding Spain by providing insurance for investors who buy government bonds in a move designed to maintain Spanish access to capital markets and minimize the cost to European taxpayers, European sources said.

One senior European source said the plan could cost about 50 billion euros ($64.5 billion) for a year. It would enable Spain to cover its full funding needs and trigger European Central bank buying of Spanish bonds in the secondary market.

If the gamble succeeds, it would achieve two important aims. Spain would be rescued without draining Europe’s entire bailout fund and there would be no contagion to Italy.

ECB’s “nuclear option” better as deterrent than weapon

Paul Taylor
Oct 1, 2012 09:05 UTC

PARIS (Reuters) – Buying unlimited quantities of bonds is sometimes described as a central bank’s nuclear option, deploying an overwhelming force that threatens speculators with annihilation.

Like atomic weapons, the bank’s powers to print money and buy securities are best held in reserve as a deterrent, even if their use would not wreak destruction on a comparable scale.

Having to use them to defend a country or a policy objective could cause unintended damage and expose fatal weaknesses in the political will to sustain the action.

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