While the world is caught up in a wave of largely irrelevant for the capital markets euphoria, things in Europe are once again going from bad to worse, as the weakest link in the European rescue has once again said no. Reuters reports: "Finland's eurosceptic True Finns party said on Monday it was sticking to its pre-election stance that it cannot support Portugal's bailout package. We cannot with good conscience support Portugal's package nor the creation of permanent bailout mechanism. Neither do we approve the hike of Finland's guarantees in the temporary stability mechanism," the party said on Monday as its formal answer to Jyrki Katainen, the leader of National Coalition party, who is leading the talks to form the country's new coalition government." As has been reported previously, absent Finnish approval, the European rescue is virtually halted in its tracks, and means that there is no consensual green light for the EFSF rescue package. Additionally, as Europe has been kind enough to indicate in the past, "there is no Plan B." And to make things very clear, Finnish MP Soini that Greece is likely to restructure its debt and other will follow, but not under the ESM: "it is a structure that doesn't work." Needless to say the implications of a failed compromise on the bailout of not only Greece, but not Ireland and Portugal as well, means that should Finland retain its intransigence, the eurozone is pretty much over.
More from the largest Finnish daily economic newspaper :
True Finns can not support the EU's rescue packages for Portugal, or the creation ofpermanent stabilization mechanism for the euro area.
It writes the lot in an e-mail message to the Conservative Party chairman Jyrki Katainen,who leads the government negotiations after the Finnish parliamentary election,according to Bloomberg News.
"Unfortunately we do not believe that the steps taken thus far are sustainable orequitable. Attempts to alleviate the crisis with these measures has been going on foryears and the successes have not been great, we stand on the brink of the abyss, "theTrue Finns in the statement.
The party says that any further step transferring more risks and losses to taxpayers inFinland and other countries.
"We can not in good conscience support the (rescue package to) Portugal, or the creation of a permanent stability mechanism. Nor do we support an increase inFinland's commitment to European financial stability of the facility, "the party of the message.
So in order to prevent a critical failure of game theory, we expect the ECB to provide some major concessions to all possible holdouts. The only problem is that Finland doesn't really need any. And yet with the great EURopean experiment on the rock, the EURUSD is trading at near multi year highs of 1.485?