"You can wake me up in the middle of the night, at 3 a.m., and I will tell you our position. Or 5 a.m., it doesn't matter. We think that euro bonds are not the right path for many reasons," a senior German government official told reporters in Berlin before an informal European Union leaders dinner summit Wednesday.
Those reasons include the fact that the bonds are "explicitly forbidden" by European Union treaties, said the official, who spoke anonymously under usual ground rules.
Merkel -- who is to meet with French President Francois Hollande and the 25 other EU leaders at the dinner -- has said she would consider euro bonds only after weak eurozone countries slash their debt and commit to tough rules on fiscal responsibility. She said the bonds, with their comingled debt, would in fact remove weak countries' incentives to clean up their fiscal acts.
The bonds' advantages of pooled credit would come mainly at Germany's expense, she says.
The debt comingling, with all 17 eurozone countries collectively issuing and guaranteeing bonds, would substantially lower the debt costs of weak countries such as Spain, analysts say. But it would substantially raise the borrowing costs of the most creditworthy countries, like Germany, whose debt is seen as particularly safe and is therefore in high demand.
With euro bonds, Triple-A rated Germany and other highly creditworthy countries would, in effect, be guaranteeing the loans of their debt-saddled neighbors, Merkel argues.
If Germany's borrowing costs were to go up to the eurozone average, its repayments would rise about $64 billion a year, the Canadian daily The Globe and Mail estimated.
Hollande has strongly backed euro bonds as a near-term solution, not just a long-term answer to a crisis that has destabilized global markets and threatened the future of the currency.
"I will outline all growth proposals at this informal meeting," he told reporters at the Group of Eight summit Camp David, Md., last weekend. "Within this packet of proposals there will be euro bonds and I will not be alone in proposing them. I had confirmation on this at the G8."
Italy, France, the European Commission, the International Monetary Fund and the Organization for Economic Cooperation and Development have all pushed for euro bonds in the past few days.
The OECD specifically called for euro bonds in a report Tuesday that said the eurozone otherwise risked creating a vicious circle of decline that could have dire effects for the world economy.
It said the bonds were needed to break the circle of "high and rising sovereign indebtedness, weak banking systems, excessive fiscal consolidation and lower growth."
"We need to get on the path towards the issuance of euro bonds sooner rather than later," OECD chief economist and Deputy Secretary-General Pier Carlo Padoan told the Financial Times.
IMF Managing Director Christine Lagarde followed an hour later at a London news conference, saying "more needs to be done, particularly by way of fiscal liability-sharing."
Germany, while increasingly isolated, is not alone in its euro bond opposition. Other countries arguing against euro bonds include Austria, Finland and the Netherlands.
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