Yesterday we explained the German constitutional court injunction in easy words.
Update July 11th:
The court says that it needs three months to discuss the injunction.
As opposed to the finance minister Schäuble, who wants to protect financial markets, the Bundesbank president Weidmann thinks that markets have already partially priced in a delay in the ESM. For Weidmann, the ESM cannot guarantee that the euro crisis will be stopped. Here the full Weidmann critic on the ESM. Weidmann makes it also clear that Germany will have losses in Target2, once the Euro breaks up.
How high is the German liability ?
The Sueddeutsche talks about the court discussion on how big the German responsibility will ultimately be, when all sources (EFSF, ESM, EFSM, greek bailout, Target2, German IMF part) are taken together. The lawyer of the right-wing plaintiffs claims that the sum is 900 bln. € and not only the 190 bln.€ ESM responsibility. Furthermore the ESM could be easily extended and increase this sum. They were not controllable by the parliament. The lawyers of the left-wing plaintiffs declare to the court that saving the euro will cost Germany 2 trillion €.
Where is the point of no return ?
Tags: Bailout,Constitutional Court,DeutschMark,EFSF,ESM,Euro crisis,Fiscal Compact,Karlsruhe,Swiss National Bank,Target2