German news magazine Der Spiegel reported on Saturday that leaders of European institutions are working on a comprehensive plan to rescue the euro that would include the issuance of joint Eurobondsâ€”a move Germany has repeatedly rejected.
The news magazine said European Union Commission President Jose Manuel Barroso, European Council President Herman Van Rompuy, Eurogroup head Jean-Claude Juncker and European Central Bank [cnbc explains] President Mario Draghi are working on plans for a “genuine fiscal union” in which individual member states would no longer be able to independently take on new borrowing.
Governments would only be able to decide how to spend money that is covered through their revenues, Der Spiegel reported. Any country that needs more money than it takes in would have to report that need to the group of euro finance ministers.
The magazine quoted four high-ranking EU planners saying this group of finance ministers would then decide which financial desires at which levels were justified and would then issue joint euro bonds to finance these new borrowing needs.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.