Europe on the fiscal precipice! Never fear, Jean-Claude is coming.
The euro rallied, commodities perked up and global stocks recovered their poise
after it emerged that Jean-Claude Trichet, European Central Bank president, was to leave a summit with his peers in Australia early and fly to the rescue of the eurozone.
Mr Trichet’s attendance at Thursday’s special meeting of European leaders, called to address the region’s economy, was seen as evidence that a deal to support Greece would be thrashed out. Greek bond yields fell sharply in response.
This is a good and bad thing. Greece was on the verge of collapse. The Eurozone would have been in a state of chaos. This gives both a much needed lifeline. At the same time, that there's such a situation to begin with is not good.