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"No one seems to be listening: Europe is out of buyers. End of story. There simply isn't --500 billion lying around to be put to use. That's why the ESM and EFSF aren't being increased in size. They couldn't be."
Especially key is that the ECB will use bailout funds to recapitalized troubled banks. They'll be hurt, not helped, like firms using LTRO (Long Term Refinancing Operation) capital "found themselves severely punished in the credit and bond markets."
In addition, nothing agreed on takes effect until yearend. No guarantees exist that troubled Eurozone economies won't collapse before then.
Expect market euphoria to be short-lived. Decisions reached don't address unresolved core issues. Insolvency, high debt levels, and speculative excesses remain troubling.
Europe needs solutions, not hype and short-term fixes. They're largely repackaged old schemes. They didn't work before and won't now.
They're offered when Greece is bankrupt. Spain is crumbling. Enough resources aren't available to help. Portugal and Ireland are sinking, Cyprus just became the fifth bailout nation, and Italy isn't far behind others.
Once post-summit euphoria ebbs, markets will realize vague policy pronouncements offer less than hoped for. Fighting fires substituted for workable solutions. At best, more time was bought. How much remains to be seen.
Global decline continues and spreads. Around 80% of world economies show visible deterioration. Celebration isn't called for. Nothing announced pre-dawn Friday changed things. Words don't substitute for solutions.
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