Germany announced plans to unilaterally impose a ban on the selling of naked shorts in an attempt to prevent further losses on stock markets that continue to hammer the euro. In her address to the German Parliament, Chancellor Angela Merkel called for wide-sweeping budget cuts in EU countries struggling with massive deficits as well as tougher penalties for countries that break EU debt rules.
In a bit of a surprise comment that sent the euro reeling, Merkel suggested an “orderly solvency” may be needed to eliminate the threat a handful of individual countries pose to the entire euro zone.
“The lack of rules and limits can make behavior in financial markets driven purely by the profit motive destructive and lead to an existential threat to financial stability in Europe and even the world,” Merkel told lawmakers in Berlin today. “The market alone won’t correct these mistakes.”
Source: Bloomberg
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