Irish thrown the path of Deficit reduction

ECB member Bini Smaghi sharply criticized France and Germany proposed debt restructuring plan to allow Member States. He said: "calls for orderly debt restructuring mechanism sounds really good, but in fact it may be worthless. To know the design and implementation are often two different things." He further highlighted that some statements within the EU leaders In this issue there are serious differences. Evolution Securities in London head of fixed income research Jenkins believes that the greatest danger now is that talking about the possibility of debt restructuring in itself will bring a "self" type of prophecy effect. Ireland and Portugal, the market worried about rising borrowing costs to such a high level, the two countries will be forced to use the euro zone's Assistance Fund, which is obviously a very "destabilizing" move. Louisiana Royal Bank of Scotland analysts said the German on the establishment of permanent mechanisms for debt crisis bondholder risk and require the proposal is exacerbated by Ireland, Portugal and other countries a reason for the problem. "In fact, until the weekend before, I think Ireland may be able to reduce the deficit by taking the necessary measures to avoid the fate of assistance. It now appears that Merkel's proposal for a lot of prospects." He said: "Affected The should not just Ireland, but all of Europe 'edge' country. "

However, some scholars believe, to target the proposal of France and Germany may be pointing the wrong target. Nielsen, European economist for Goldman Sachs, commented: "It does look to be about the future euro zone debt restructuring proposal to be intimidated, but it should not be a topic of surprise, unless you are sure the taxpayers are always in Germany willing to pay for everything. "implies that people should be the focus of discussion in Europe" borderline "countries and those who do not observe fiscal discipline, the state should solve its own problems, how to, reducing the new mechanism may be brought to its impact.

Irish government spending last year as a review of the former Federal Reserve economist, team leader Cam McKinsey believes that the Irish government bonds in the new year in order to successfully re-enter the market attitude is feasible. "If the (Irish government) will enable investors to be convinced, borrowing costs to fall, then the need for international assistance in this country remaining variables. On the contrary, something that is explosive." He said. In addition, credit rating agencies Moody's believes that Greece, Portugal and Ireland is likely to avoid sovereign debt default, because the three Jieyou strong domestic investor base, even in times of tension, local banks and pension funds and other institutions will buy the Government bonds. However, there are still a large number of investors and analysts believe that in Europe sooner or later there will be one or more countries may need to restructure the debt, and now look at the greatest risk of Greece.