Pressure builds as eurozone ponders debt solutions
By DON MELVIN and RAF CASERT | AP
BRUSSELS (AP) — With Italy sinking rapidly into financial chaos, the eurozone's 17 finance ministers scrambled Tuesday to find enough money to give their rescue fund a veneer of credibility and world markets some reason to believe their embattled currency won't break up.
Italy's borrowing rates shot up above 7 percent Tuesday, an unsustainable level that already has forced three smaller EU nations to seek bailouts. Markets rose for the second day on hopes that the enormous pressures on the ministers would produce some results.
The finance ministers were discussing ideas that until recently would have been taboo: countries ceding additional budgetary sovereignty to a central authority — EU headquarters in Brussels.
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If Italy were to default on its euro1.9 trillion ($2.5 trillion) debt, the fallout could break up the currency used by 322 million people and send shock waves throughout the global economy.
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"I will probably be the first Polish foreign minister in history to say so, but here it is," Radek Sikorski said in Berlin. "I fear German power less than I am beginning to fear German inactivity ... the biggest threat to the security and prosperity of Poland would be the collapse of the eurozone."
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Full story: http://news.yahoo.com/pressure-builds-eurozone-ponders-debt-solutions-171745129.html
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