The Bailing Out Continues in Europe
BRUSSELS, Belgium (AP) — Dutch-Belgian bank and insurance giant Fortis NV was given a 11.2 billion euro($16.4 billion) lifeline to avert insolvency as part of a wider bailout plan agreed to by Belgium, the Netherlands and Luxembourg, officials said Sunday.
Belgium’s Prime Minister Yves Leterme said the bailout shows savers and investors that debt-laden Fortis will not be allowed to fall victim to the global credit crisis after its share price plummeted in recent days.
I got this story sent to me by someone who asked “What’s the difference here?” I’m not sure what that meant, but if it asked what the difference between European and American actions is, I would say there are several factors. Please keep note that I am not an economic expert by any stretch of the imagination.
European governments are required to match budget deficit limits for membership that entail not going above 3% of GDP. Also, $16.4 billion is a whole lot less than $700 billion. With a good deal of fiscal conservatism in the European Union, my knee-jerk reaction is that the European Union will use its resources better than the current United States government.