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According to Phoenix Capital Research , morning headlines falsely called Brussels' announcement a game-changer.
Bailout funds don't subordinate private debt holdings. They don't change the more critical issue of stopping defaults from happening.
What's proposed doesn't say "where the money is going to come from." EFSF and ESM rescue mechanisms are one thing. More important is who'll fund them and how.
All Eurozone countries are supposed to contribute. Italy and Spain (Euroland's third and fourth largest economies) are supposed to provide 30% of funding. How can they and other troubled economies needing bailouts?
Moreover, ESM so far doesn't exist. Only four of 17 Eurozone countries approved it.
Phoenix Capital said "(y)ou couldn't make this stuff up if you tried."
In addition, no agreement was reached to increase EFSF or ESM funding. Why is simple. Countries don't have the resources.
According to Phoenix Capital:
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