Germany and France to put more money into EFSF, as the Euro monetary experiment is waiting for a fiscal explosion

Portugal seems to be sending the message that he they don't need assistance from Brussels.  But no one really believes them.  Yesterday's auction was oversubscribed, but current bids on Portugal debt are still above Ireland's when they went to Europe with their tin cup. 

Now Germany and France are putting more money into the "European Financial Stability Facility".  This is just their being aware that Portugal has no way out.  For that matter, the Euro is an monetary experiment waiting for a fiscal explosion.

Another real reason to put more money into the pot, is after Greece and Ireland, it is becoming clear that especially Greece will default on their external debt in some fashion.  That would threaten EFSF's AAA rating from the agencies without more money.  Via Wash. Post:
A senior European Union official said that precise details are still under discussion and are dependent on agreement from France and Germany, which is by no means guaranteed. One proposal is to expand the fund's capital reserves so that a full $577.8 billion could be committed toward countries that request assistance. The fund as it is currently constituted cannot lend out its full reserves because of the creditworthiness of some of the countries that have contributed to it, and analysts have said that its true capacity is likely closer to $328.3 billion to $393.9 billion.

EFSF website


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