The head of the European Central Bank hit out at the political paralysis gripping the region as he warned the eurozone’s set-up was “unsustainable”.
ECB President Draghi arrives at the European Parliament economic and monetary affairs committee in Brussels on Thursday. Photo: Reuters
By Louise Armitstead, Chief business correspondent
The Telegraph, UK
8:26PM BST 31 May 2012
Mario Draghi said the central bank could not “fill the vacuum” left by member states’ lack of action as it was claimed the zone is on the point of “disintegration”.
Amid escalating talk of a potential bail-out for Spain, the president of the ECB said the central bank was powerless to stop the debt tornado. “It’s not our duty, it’s not in our mandate” to “fill the vacuum left by the lack of action by national governments on the fiscal front,” he said.
Christine Lagarde, the head of the International Monetary Fund, last night denied that an IMF bail-out of Spain was being prepared.
“There is no such plan. We have not received any request to that effect and we are not doing any work in relation to any financial support,” she said, following a meeting with Spain’s deputy prime minister, Soraya Saenz de Santamaria.
Olli Rehn, the EU’s top economic official, called for urgent action to “avoid a disintegration of the eurozone.” The economic affairs commissioner said that politicians had made progress but it had been “uneven and seemingly inefficient.”
Underling the fears gripping many investors, the FTSE closed down 7.5pc in May, suffering its worst month since February 2009 when the banking crisis was at its height.
A raft of poor economic data in America compounded fears for the eurozone and the global economy. US GDP expanded by just 1.9pc in the first quarter, rather than the 2.2pc first estimate, while jobless claims climbed.
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This is what happens to a country (Spain), a world bank (IMF) and a world leader (US) when they are out of money. They rearrange the chairs on the deck of the Titanic.
Greece, Italy and Spain are spending 150% or more of GDP on entitlements for their citizens with no money in their treasury and not a chance of coming up with the money. Austerity seems cruel but how in the world did they promise so much when they had so little.
The IMF is just as stupid because they know someone will be without a chair when the music stops. We, the US, are the worst because we print money for wars that are needless and cruel and loan money to people that hate us by borrowing it from other countries and then also printing it in wheelbarrows full of worthless script. The cabal pits us against each other..Black/White, Rich/Poor, Catholic/Catholic haters, America/Russia, America/China, America/Middle East, you know the drill. All to take our attention away from the fact that we are all one. That with love and kindness, freedom and responsibility… there is plenty for all.
How could this not all fall in? God, family, friends, goodness, the light, Love, appreciation of nature…this is all we really have. From these simple things, we can have it all, build it all. Everything else is a charade, a ruse, temporary.