European Union Leaders Agree To Growth Package, Half Of Which Was Already Promised

BRUSSELS — European leaders have agreed to use the continent's permanent bailout fund to recapitalize struggling banks, and agreed to the idea of a tighter union in the long term.

The bank decision at overnight meetings in Brussels on Friday was aimed at helping Spain, which sought a (EURO)100 billion rescue to help its troubled banks and is facing rising borrowing costs.

EU President Herman Van Rompuy called it a "breakthrough that banks can be recapitalized directly."

He said leaders of the 17-nation eurozone also agreed to a joint banking supervisory body.

He said the leaders of the full 27-member European Union agreed to a general long-term plan for a tighter budgetary and political union.

Comments

[Jarryd Willis]

12:09 PM on 06/29/2012

It won't be reflected in the next week's jobs numbers, but this plan could be a boost to confidence & the economy. European partners may buy/trade more in coming months once their economic psychology changes, providing a much needed lift to our economy. There is a chance this plan will only stabilize matters & won't provide any economic boost; however, that's better than everyone being on edge about a potential European crash.

This obviously helps President Obama, not to mention the victory on ObamaCare, and Romney's loss on the Arizona law. A great week to end a bad month. Things may get tough again next Friday if the jobs numbers are sub-par for another consecutive month. Hopefully we're able to get this Transportation bill passed before July 4th recess.

[Fredo777]

10:25 AM on 07/02/2012

The transportation bill was passed.

http://huff.to/N43N95

[nanjemoy]

11:27 AM on 06/29/2012

WOW!

That's huge news.

Well done.

[wordenreport]

11:23 AM on 06/29/2012

The incrementalism in the E.U.'s latest moves in establishing a banking supervisory agency like the Federal Reserve and in allowing the bailout funds to be lent directly to banks is perfectly in line with the history of the European Union. Even in a crisis, the E.U. will integrate further bit by bit, with an emphasis on negotiation. For more, pls see my essay at http://thewordenreport.blogspot.com/2012/06/incremental-change-in-eu-banking.html

[Ngonyama]

11:06 AM on 06/29/2012

What strikes me from all the comments here is how totally at loss Americans are in understanding what is really going on in Europe.

Yes the Greek economy and the German one are different, but the same can be said for Mississippi's and Vermont's. Does that make the dollar impossible? Yes Europeans speak a whole bunch of languages but what has that got to do with anything?

The problem is really that some politicians are confronted with the consequences of thier wanting their cake and eating it. Yes they wanted a big Europe and yes they wanted transfer of sovereignty. As long as it wasn't theirs. (Germany and especially France have played that game since 1957). Yes they wanted a common currency, as long as it did not mean a common treasury.

You cannot have all the perks of a big union and not the downsides. It does not work. Europe needs a common treasury. It needs to unite. NOW!

[SubspaceEcho]

10:35 AM on 06/29/2012

@Cynaegirus the hero

"there is a controversy between berlusconi and germany and guess why:
pipeline SOUTH STREAM.every country signed for that pipeline guess what happened.... "

I fav'd your comment, because I really had a good laugh.

Please explain what happened, it sounds interesting.

[Ngonyama]

11:13 AM on 06/29/2012

especially the Berlusconi part

[candysays]

10:30 AM on 06/29/2012

The longer they say no to the disastrous idea of eurobonds the longer time for reform of state sectors and regulation of the financial sectors that could make eurobonds an acceptable proposition.

[TomSequim]

10:22 AM on 06/29/2012

The headline said that the EU leaders agreed to a growth package....but I only read that they agreed to bailout the banks to recapitalize...which, I believe, will really only enable the banks to keep buying EU country bonds. Will the banks really make loans to businesses and/or is there a plan somewhere to specifically stimulate the growth of employment?

If not, then I don't see how this plan will really trigger growth, rather than to continue to put dents in the can being kicked down the road. Guess I have to read a more detailed news report to understand what they have really done. I would hope they would be triggering higher employment in order to stimulate the economies, but don't see it in the report.

[rcampbell]

10:18 AM on 06/29/2012

Europe has admitted the failure of the conservative model of austerity. It has failed. It always fails. It's failed in the US as well. Europe has now adopted the successful Obama model of stimulus. Once again, he's right and the right's wrong.

[glucash22]

10:10 AM on 06/29/2012

That's right, just keep on kicking the can. Bandaids never stop the bleeding.

[MKWaters esq]

10:01 AM on 06/29/2012

Stop the austerity and help the people already!

[bluecub]

09:32 AM on 06/29/2012

International bankers have buried us. Our politicians facilitated the laws and deregulation, but we know where the heart of evil lives.

[darksigns84]

09:31 AM on 06/29/2012

Every bailout in Europe has failed, when will they learn that continuing to do the same thing over and over, will not yield different results?

The banks are so happy about this bailout because they are the ones who are making out here, not the people. If they would just all take the loss now, they can start digging themselves out before it gets to the point where Greece is, basically 3rd world status.

[savantfool]

09:25 AM on 06/29/2012

Ah great...Holland loves this. He just changed the retirement age back down to 60 and has no way to pay it. So the Euro bonds are the goal. The southern countries can keep throwing money into the fire and the northern states have to pay their debts once France, Spain, italy, cypress and greece say: oopsy....I forgot to tell you I can't pay.

Imagine you're in a restaurant and you get charged for another table because the people there told the waiter you'd pay for them.

Now the EU truly will go down. Because the southern states and their frivolous spending and bad investments will drag it down.

[Cynaegirus the hero]

10:02 AM on 06/29/2012

cyprus

cypress hill is a band.

[savantfool]

10:13 AM on 06/29/2012

meh dang typos.

[den1953]

08:54 AM on 06/29/2012

Somewhere on Wall street the hedge fund wealth mongers are licking their chops waiting on the bailout, the casino is open for business!

[Paulo1]

08:48 AM on 06/29/2012

Another stupid idea from the people who mired Europe in "austerity"

Keep pouring money into banks and propping them up so they can continue to prosper while most of Europe sees its standard of living and jobs disappear. Who do these people think they are Republicans?
People on the right mock European socialism, they should be mocking European corporatism. If they keep doing these bank bail outs they are going to end up spreading the depression from the Med countries to the rest of Europe as well.