Not So Fast: Finland And Holland Will Block ESM Bond Buying

Tyler Durden's picture


While the bailout ball is in the German constitutional court, which has 8 days to decide, and potentially put the entire timeline of Europe's bailout in limbo should it cogitate longer than July 9 without handing over the ESM law to the president, in effect forcing the country into a Euro bailout referendum, it is easy to forget that there are other AAA-rated countries in Europe, which also have a say as to who gets bailed out. As of this morning, it appears that Germany may increasingly be the only one left footing the insolvency bill as both Finland and Holland said "Ei" and "Nee" respectively.

From Reuters:

Finland and the Netherlands will block the euro zone's permanent bailout fund from buying bonds in secondary markets, the Finnish government said on Monday, despite European leaders' decision last week that rescue funds be available to stabilise markets.


Euro zone leaders agreed at the summit on steps to shore up their monetary union and bring down borrowing costs for Spain and Italy, but they had given few details on the use of the temporary EFSF and permanent ESM rescue funds.


ESM bond buying from secondary markets would require unanimity and that seems unlikely because Finland and the Netherlands are against it, the Finnish government said a report to a parliamentary committee.

And more, also from Reuters:

Finland will block the euro zone's permanent bailout fund from buying government bonds in the open market, the Finnish government said on Monday, while The Netherlands also indicated opposition to the bond-buying idea.


Comments suggesting a rough time ahead for the idea followed euro zone leaders' agreement at a summit last week to take steps to shore up their monetary union and bring down Spanish and Italian borrowing costs.


They gave few details on how they might use the temporary EFSF and permanent ESM rescue funds to buy bonds.


A Dutch finance ministry spokesman said on Monday his government did not like the bond-buying idea but did not explicitly say the Netherlands would block the plan, saying only that it would evaluate purchases on a case-by-case basis.


"The prime minister said on Friday he is not in favour of buying up bonds," said Niels Redeker, spokesman for the Dutch finance ministry. "Using the existing instruments to buy up bonds will be expensive and can only be done if there is unanimity (between member states). That means the Netherlands would need to vote in favour."


On the insistence of Spain and Italy, now in the eye of the euro debt storm, euro zone leaders decided last week to soften slightly the terms on which countries that observe EU rules and recommendations can get euro zone help to lower market premiums.

So while Germany is indeed left all alone to preserve the European dream, we wonder: just what is the reason to keep calling Europe a "Union" when this is rapidly becoming the biggest misnomer of all time?

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Mon, 07/02/2012 - 06:42 | 2580045 Bokkenrijder
Bokkenrijder's picture

"The Netherlands" please!

"Holland" is for tourists...

Mon, 07/02/2012 - 06:42 | 2580046 maxmad
maxmad's picture

Collapse on!  Bitchez!

Mon, 07/02/2012 - 06:48 | 2580055 tocointhephrase
tocointhephrase's picture

Up in smoke Bitchez!

Mon, 07/02/2012 - 08:43 | 2580219 Randall Cabot
Randall Cabot's picture

I just heard some Dutch-sounding dude, Eric somebody, on Bloomberg radio say that Holland doesn't like it but won't block it.

Mon, 07/02/2012 - 07:44 | 2580127 Kingbingo
Kingbingo's picture

As famously remarked by Lady Thatcher “Socialism works ….. until you run out of other people’s money”. Looks like the EUSSR is finally going to find out the hard way exactly that.

Mon, 07/02/2012 - 08:17 | 2580175 writingsonthewall
writingsonthewall's picture

A comment she plagurised from someone else...


Your insistance on attacking Socialism is quite laughable- firstly the EU is not socialist (maybe you should look up what socialism is before you start applying labels)


secondly (and most amusingly) - it's CAPITALISM which has run out of other people's money - this is why banks have resorted to fraud and fixng LIBOR rates to 'earn' money.


I presume you knew all this - or should I assume you're just another parrot who loves to repeat a simple catch phrase thinking it makes them look clever?

Mon, 07/02/2012 - 08:28 | 2580200 Eff
Eff's picture

So true.

Mon, 07/02/2012 - 09:00 | 2580297 Oldwood
Oldwood's picture

No, it is a transition from the inequities of capitalism to fascism. Fascism is to be transformed to socialism to remedy its corruption. Socialism will them be transformed into communism to resolve it's inefficiencies and then Communism will transform into totally anarchy to relieve itself of absolute tyranny. It doesn't really matter much where we are on the path if we know where it's heading. We just know we are nearing the point where there is more fear of liberty than longing for it.

Mon, 07/02/2012 - 09:42 | 2580412 kikkoman
kikkoman's picture

Might I suggest that you look up capitalism?

That's when you fuck up, you fail. You don't get billions of taxpayer money blown into your ass.

Whatever you want to label that, it certainly isn't capitalism.

Mon, 07/02/2012 - 14:46 | 2581329 Kobe Beef
Kobe Beef's picture

Crony + Capitalism = Crapitalism.

That's what I call it.

Mon, 07/02/2012 - 11:11 | 2580691 MJ
MJ's picture

Governments run by corporations that writes laws to favor corporations above all else. 

Once the government becomes involved in skewing the price system you no longer have capitalism.

Mon, 07/02/2012 - 06:47 | 2580053 cherry picker
cherry picker's picture

It is the country I was born iin and was a World Power in the 16th Century.

Don't ever underestimate the Dutch.

Mon, 07/02/2012 - 06:56 | 2580073 cossack55
cossack55's picture

Especially Dutch Schultz.

Mon, 07/02/2012 - 06:58 | 2580075 Rusticus
Rusticus's picture

Don't ever underestimate the Dutch.


Indeed,  "Going Dutch"

Mon, 07/02/2012 - 06:59 | 2580076 Miss Expectations
Miss Expectations's picture

I spent 2 weeks with a family in Edinburgh when I was a student.  The subject of how "thrifty" the Scots were came up during a dinner conversation.  We were told that if we thought the Scots were "thrifty" we clearly hadn't ever been to Holland.

Mon, 07/02/2012 - 07:30 | 2580108 LikeClockwork
LikeClockwork's picture

Bicycles for -gasp- transport. Shoes carved from tree stumps!

Mon, 07/02/2012 - 07:35 | 2580117 Joe A
Joe A's picture

You should go to Belgium, even worse. Not kidding.

Mon, 07/02/2012 - 07:38 | 2580123 Joe A
Joe A's picture

I am Dutch and we tend to overestimate ourselves, although the country is not doing bad for its size.

Mon, 07/02/2012 - 08:20 | 2580183 Mike in Tokyo Rogers
Mike in Tokyo Rogers's picture

That's funny and I don't mean to be rude!!! Great cynicism! Being a loser m'self, I can relate!

Mon, 07/02/2012 - 12:05 | 2580833 poldark
poldark's picture

That is true. Remember the Boer War and the battle of Sole Bay.

Mon, 07/02/2012 - 06:50 | 2580060 slaughterer
slaughterer's picture

"Using the existing instruments to buy up bonds will be expensive..."

and probably completely exhaust the facility in less than half a year.  (He forgot to say).

Mon, 07/02/2012 - 07:48 | 2580062 cossack55
cossack55's picture

I have always liked the "Low Countries", but I guess that now applies to the PIIGS.

Mon, 07/02/2012 - 08:25 | 2580193 debtor of last ...
debtor of last resort's picture

So is the ESM.

Mon, 07/02/2012 - 06:43 | 2580047 Fips_OnTheSpot
Fips_OnTheSpot's picture

Not passing to Gauck before July, 9th wont trigger a referendum at all. Weird conclusion.

Mon, 07/02/2012 - 06:46 | 2580048 Croatian Patriot
Croatian Patriot's picture

IMHO Finland will first leave the eurozone. Not Greece, not Germany!

Mon, 07/02/2012 - 06:57 | 2580064 cossack55
cossack55's picture


Mon, 07/02/2012 - 08:20 | 2580182 Rogier
Rogier's picture


Mon, 07/02/2012 - 10:37 | 2580582 flapdoodle
flapdoodle's picture


Mon, 07/02/2012 - 12:08 | 2580836 poldark
poldark's picture

As someone said before- It is alway hardest for the first person to leave a crap party.

For the second it is much easier.

Mon, 07/02/2012 - 06:59 | 2580051 strongband
strongband's picture

put all the EFSF/ESM on Oanda. @ 1:100 - it brings out the unicorns.

Mon, 07/02/2012 - 06:47 | 2580054 printmoremoney
printmoremoney's picture

The Emperor Has No Clothes. Pass it on....

Mon, 07/02/2012 - 06:50 | 2580059 tocointhephrase
tocointhephrase's picture

The Emperor has a little wiener. Pass it on...

Mon, 07/02/2012 - 08:31 | 2580207 crowd
crowd's picture

The Emperor is circumcised

Mon, 07/02/2012 - 06:51 | 2580061 strongband
strongband's picture

The empress has no clothes pass it on...

Mon, 07/02/2012 - 06:52 | 2580063 Sudden Debt
Sudden Debt's picture

as a Belgium citizen it comes hard for me to say this but GO HOLLAND!! at least they're still sane!
I wish my corrupt socialist government would also grow a brain...

Mon, 07/02/2012 - 06:52 | 2580067 cossack55
cossack55's picture

Import and implant a brain from Iceland.

Mon, 07/02/2012 - 06:55 | 2580072 Fips_OnTheSpot
Fips_OnTheSpot's picture

"GO HOLLAND" would be like "GO BAVARIA" or "GO TEXAS" ;-)


Greets to Belgium and pass me a GULDEN DRAAK :D

Mon, 07/02/2012 - 07:00 | 2580077 cherry picker
cherry picker's picture

My father used to smuggle food into Holland from Belgium during WW2.  Time to unite if the cause is worthwile, si?

Mon, 07/02/2012 - 08:17 | 2580174 blabam
blabam's picture

Since when does Belgium have a government LOL?

Mon, 07/02/2012 - 09:10 | 2580328 debtor of last ...
debtor of last resort's picture

Sane goes for the people, i tell you. Government is insane, for many years. A savior called Fortyun got shot 10 years ago, from that moment people are fucked by mainstream politics, and people, incl myself, are getting sick and tired of these europhile fuckups. Watch 12 sep.

The Netherlands said NO to a EU constitution. What we got was 98% of this constitution called the Lisbon Treason.

So, to hell with fascist big money and their servants in The Hague.

Mon, 07/02/2012 - 06:52 | 2580065 slaughterer
slaughterer's picture

But EZ indices are up on the German Justice Minister saying he is "confident" that Karlsruhe will not delay the ESM. 

Mon, 07/02/2012 - 06:52 | 2580066 jannewmx
jannewmx's picture

Maybe it was Merkel's plan all along. She knew she couldn't blatantly say no to the new bailouts so she is using Finland and Netherland pull the rug for her. It would be funny when Germany is the only country jumping to avoid falling down while Italy and Spain gets the rug pulled under them.

Mon, 07/02/2012 - 06:54 | 2580069 cossack55
cossack55's picture

Maybe if Spain and Italy would roll up a few technocrats in a rug they could relearn how to jump.

Mon, 07/02/2012 - 07:35 | 2580116 kikkoman
kikkoman's picture

You're giving waaaaaay too much credit to that lying, spineless, opportunistic - and delusional - Maoist bitch.

Listen to what she says. She does know that a defeat can't be sold to voters, but still she BELIEVES in all that crap - that the ESM is a good investment, that further integration is necessary and POSSIBLE, bla, bla bla.

Her delusion keeps her from seeing the conflicts that will ultimately arise -for her, too - when the ESM will(?) be in place and starts to demand (not ask for) cash that isn't there. And remember, last week, one day after her defeat she successfully peddled that shit to the parliament.

What a fucking disgrace.

Anyway, I'm prepared to see her go from hopeful thorugh frustrated to absolutely terrified. And, unless for instance Finland exits first, I almost count on her to agree to some form of Eurobonds, weakened and under a different name.


Mon, 07/02/2012 - 06:55 | 2580071 Cast Iron Skillet
Cast Iron Skillet's picture

"Finland & Holland will stop ESM Bond Buying"

I sure hope so.

Mon, 07/02/2012 - 07:13 | 2580090 Vince Clortho
Vince Clortho's picture

More bad theater.  Their leaders will compromise just like every single European and American politician before them.

All kneel to the monetary power.

"Men of Principle" is a dead concept from that past.

Political "Will" and moral principle have been replaced by spineless maggots praying  that the overlords look upon them favorably and throw some coins in their direction.

Mon, 07/02/2012 - 06:58 | 2580074 asteroids
asteroids's picture

Fixing debt with more debt is wishful thinking and will mathematically kill you one day. Ask Steve Jobs about that. Oh, you can't, he's dead.

Mon, 07/02/2012 - 07:02 | 2580079 chump666
chump666's picture

some bad vibes creeping in...again. 

Mon, 07/02/2012 - 08:12 | 2580165 Oleander
Oleander's picture

Nee  Nee Nee-  So the vote came down to some guys living in the forest who adore shrubbery.  Yes that is a bit creepy.

Mon, 07/02/2012 - 07:04 | 2580081 nmewn
nmewn's picture

"While the bailout ball is in the German constitutional court..."

Its a tax on the people via currency devaluation...government taxes, the people pay.


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