European Union leaders agreed to amend the bloc’s treaties to create a permanent debt-crisis mechanism in 2013 as they struggled to bridge divisions over immediate steps to stabilize bond markets.
Solutions in search of a problem don't fund themselves. They require a demonstrable commitment of other people's money:
The ECB, in charge of monetary policy in the 16-nation euro area, said it would almost double its capital to 10.76 billion euros to cope with bigger credit risk and market volatility. Euro zone members will provide the increase.
Ten billion euros is a drop in the bucket but it sets a precedent for more. The ECB can always follow the Fed's lead and just print away Europe's debts. Alternatively, we can all let sanity reign and allow bankrupt states to go bankrupt and wipe out their bondholders. That's my solution. It won't happen.
