Ireland tax battle adds layer to euro debt crisis

LONDON (MarketWatch) — Ireland’s low corporate tax rate isn’t responsible for Europe’s debt woes, but a battle over the levy is adding yet another layer of uncertainty to the euro-zone’s long-running sovereign debt crisis.

The Irish 10-year government bond yield pushed above 10% Thursday, while short-term two-year yields also traded near double digits, underlining fears that the 85 billion euro ($120.1 billion) European Union-International Monetary Fund bailout provided last autumn won’t be enough to ensure Dublin avoids default.

Irish Notes Slump, Portugal Bonds Drop as Debt Crisis Deepens

March 23 (Bloomberg) -- Irish two-year notes slumped, leading the bonds of the region’s most-indebted nations lower, on concern a permanent solution to the fiscal crisis will elude European Union leaders meeting at a summit starting tomorrow.

The declines drove the yield on the Irish security to more than 10 percent for the second consecutive day, while the extra yield investors demand to hold the nation’s 10-year bonds instead of German bunds climbed to a record. Portuguese bonds slid as Prime Minister Jose Socrates faces a vote today against his deficit-cutting plan that may spur early elections and the need for an EU bailout.

Romania, the European country with the highest drop in IT market during the crisis

The sales of electronic and IT products were last year almost 1,234 million euro, half against the maximum reached in 2008 and with one billion euro less ( 44.4%) against 2007, the best year for the Romanian economy. It is the highest drop recorded by one of the 18 European countries where the GFK company researches the market of long-lasting goods.

How Germany can avoid a two-speed Europe

The “euro crisis” is generally seen as a currency crisis, but it is also a sovereign debt and, even more, a banking crisis. The situation is complex. The complexity has bred confusion, and this has political consequences. Europe’s various member states have formed widely different views and their policies reflect their views rather than their true national interests. The clash of perceptions carries the seeds of serious political conflicts.
The solution that is about to be put in place will, in effect, be dictated by Germany, without whose sovereign credit no solution is possible. France tries to influence the outcome but in the end must yield to Germany because its triple A rating is dependent on being closely allied with Germany.

European leaders boldly decide to carry on muddling through

A BARGAIN, but not a grand one. Euro-zone leaders surprised many on March 12th by agreeing on the main elements of a deal to salve Europe’s sovereign-debt crisis. With negotiations becoming fractious and markets unnerved by further ratings downgrades on Greek and Spanish debt, there had been fears that a deal might not be reached by a deadline of March 25th, when Europe’s heads of governments conclude their next meeting in Brussels. In the event, a special summit of euro-area leaders hammered the essentials out two weeks ahead of schedule.