Anthony Hall
Investors will return to headline-swooning this week while European leaders draw up plans to see how much smoke and how many mirrors will fix the euro.
If that sounds judgmental, call it something else, but it takes a bit of pomp and perplexity to keep conjuring up solutions that have little to do with the problem at hand. This week, leaders of Germany and France will sit down to thrash out a compromise solution that favors, guess who, Germany and France, almost as if those two seniors once again had to call the shots because those immature juniors, sophomores and freshmen couldn't possibly handle a decision on their own.
German Chancellor Angela Merkel and French President Nicolas Sarkozy are sometimes described as the primary leaders of the eurozone. Hey, who died and left those guys in charge? Isn't this about 17 nations working together? Not exactly.
Let's rewind that metaphor: This is about two older siblings who understand they have to keep 15 other siblings fed and alive until the parents come home. In the meantime, if they make decisions that go their way, who can blame them?
And, as they have for two years, Merkel and Sarkozy are pulling themselves aside Monday for a bit of nosh and manipulation. Anyone from France or Germany would expect no less. They are not meeting, to put it one way, to make sure Athens, one day, takes over the world.
Once again, these two dominant (some say primary) players will be looking to increase the size of the rescue fund, which only guarantees Germany and France will be "primary" players for that many more years to come, as the group lends more to "secondary" countries -- countries that are not doing as well.
Included in the latest round of solutions is the concept of rewriting treaties to allow a central authority to review national budgets of eurozone members and either pass sanctions on non-compliant or fiscally irresponsible members.
Still, some economists argue that none of this touches the problem with the euro, which is the imbalance of national policies and the availability of resources that all depend on the same currency exchange rate.
In pretending otherwise, Germany has prospered at Greece's expense. Fixing that problem is what Merkel does not want to discuss. To wit: Fixing Greece's credit problem is not as valuable a long-term solution as fixing Greece's industrial problem.
It's just common sense. Leaders in Athens should say, "Don't give us a loan, give us a viable assembly plant so Greek workers can make Volkswagen cars." That's what Germany does not want to give up.
Germany and France are not just the "primary" countries of the eurozone. It's a question of haves and have-nots within the extended family of the eurozone, where a few of the "secondary siblings," namely Spain, Italy, Greece and Portugal, are floundering.
In international markets Monday, the Nikkei 225 index rose 0.6 percent and the Shanghai composite index in China dropped 1.16 percent. The Hang Seng index in Hong Kong rose 0.73 percent and the Sensex in India slid 0.25 percent.
In Australia, the S&P/ASX 200 rose 0.78 percent.
In midday trading in Europe, the FTSE 100 in Britain rose 0.74 percent while the DAX 30 in Germany added 0.63 percent. The CAC 40 in France gained 0.97 percent and the Stoxx Europe 600 added 0.87 percent.
