Disappointment

Las primeras reacciones a los vagos planes que han acordado Merkel y Sarkozy (el Poder y su palanganero, really) son analizadas muy sagazmente por

Mohamed El-Erian, chief executive and co-chief investment officer at PIMCO, briefly responds to Tuesday’s news out of Paris.

En Alphaville.ft______

Judging from the press conference, France has now aligned itself with a Germany that is increasingly, and effectively, asserting itself on the Eurozone. Assuming full implementation of this joint agreement, and that is far from certain, the Eurozone that emerges down the road will be better integrated, more fiscally disciplined and, possibly, smaller in size.

The message from Germany and France is clear: progress towards budget balance and better economic governance must come before additional cheque writings, Eurobonds and other financial engineering aimed at bailing out profligate peripheral economies.

It is not surprising that Germany is pushing this line. The fact that France is endorsing it so strongly is much more of a surprise. I suspect it reflects the loud alarm bells associated with last week’s market debacle.

Peripheral economies will not be thrilled with this outcome. They must now press ahead even more forcefully with fiscal austerity, and they will be asked to adhere to a “golden rule” that would hardwire stronger fiscal discipline.

With so many markets having priced in more German cheque writing, equity markets will likely come under immediate pressure, German and US bonds will likely rally initially, and peripheral credit spreads will likely widen.

Efectivamente; lo que han dicho la Jefa y su palanganero es  que, primero, austeridad, luego ya veremos eso del eurobono. Sin embargo, lo que esperan los mercados, colgando de un hilito, es una señal de eurobono, antes de que todo se vaya al carajo. Recuerden lo que les decía ayer: se puede optar por desendeudarse antes de crecer, o al revés. Lo primero es el suicido, lo segundo es la única posibilidad.
Se configura, dice El-Erian, una zona euro más disciplinada, más unida, y, probablemente, menor de tamaño. Así no hay duda que van a salvar el euro, pero un euro más fuerte más sano que expulsará a las tinieblas a los débiles. Un euro más Nietsziano, en definitiva.
Nuestra única esperanza es que esos dos se den cuenta, antes de que sea tarde, que el tinglado se les puede caer encima a ellos también.