As the IMF and the EU send their teams to Athens on Monday April 19th 2010, to further discuss aid to Greece, another set of people are preparing their battle plan to challenge the EU if any aid is giving to Greece.
A group of four German Professors intend to take EU to court if it helps Greece, as according to the Professors, any aid provided to Greece violates the “no-bailout” clause of the EU treaty. Professor Karl Albrecht Schachtschneider from the University of Erlangen-Nürnberg, is one of a group of professors preparing to challenge the rescue plan for Greece at Germany's constitutional court as soon as the mechanism is activated.
As the four professors who took the German government to the German constitutional court in 1998 over Germany’s entry into the euro, they have a track record of taking on governments and not hesitating in speaking their mind.
Here is a short CNBC interview:
The EU bailout details announced over the weekend did help pacify the market but only for a short while. As one can see in the chart below, the Greek 10 yields (the red line) and the 10 year spread between Greece and Germany has inched back to the pre-bailout announcement levels.
I had written an article earlier which detailed of an IMF package vs. market based funding, the details are here.
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