NEW EU STRATEGY IS TO KILL THE MESSENGER!

New divisions among EU 27 continue regarding the debt crisis and Greece. No progress is being made, No united front regarding banks and the need for recapitalization, No progress on tax on financial transactions, push back to October any decision concerning the payment of an additional € 8 billion to Greece.

The only agreement was to criticize the intervention of U.S. Secretary of Treasury Timothy Geithner. What did the U.S. Secretary of Treasury say? Basically he said three things:

1. Politicians and central banks need to take out the catastrrophic risk to markets. They have to remove the threat of cascading defaults and avoid loose talk about dismantling the institutions of the euro;

2. What is very damaging from the outside is to see not just the divisiveness in Europe in the broader debate about strategy, but the ongoing conflict between the governments and the central bank. Europeans need to work together to do what is essential for the resolution of any crisis.

3. Increase the size of the € 440 billion European Financial Stability Facility (EFSF) via a  plan backed by the European Central Bank. The response of the EU was abrupt:  'We dont' need to receive lessons from you".

Whatever the U.S. situation may be, the U.S. Secretary of Treasury must have wondered why he was invited to the meeting in the first place and in any case the EU reaction is certainly not the way to win and influence people.   Instead of attacking the U.S. Secretary of Treasury's remarks may be that European politicians and governments  should perhaps reflect why the outside world view them as being indecisive and try to correct their behaviour to calm markets.