what we see in terms of fiscal stimulus and fiscal aid for the italian economy in the euro zone i think will play a key part in the trajectory for the italian economy going forward. what the culmination is in terms of whether you get loans or grants i think will be very key btp'sms of determining and the trajectory for the italian economy. that being said, i think the announcements we have heard from the ecb, the fact that it is prepared and said it will be expand thed will program, it is using the tltro ltro to support the sector as well, so i think you could see further compression between italy and germany from here. you could also see some compression as well in spreads banks and germany as well. in terms of spreads in italy, which are still pretty wide, you could see some compression at least in the short term. vonnie: are you surprised that yields in hilly it -- in italy our entire? this is a country on the verge -- in italy aren't higher? this is a country on the verge of junk, making huge use of the ecb facilities, and you can buy instead for 1.75%. marilyn: the downgrade wasn't

, it could lead to political pressures that could tear the euro zone apart. while, even with the numbers terrell -- meanwhile, even with the numbers terrible, the german forming its own plans to reopen. and the limerick was meeting with leaders to form a plan this morning. -- angela merkel meeting with leaders to form a plan this morning. coordinate because some of the governors -- again, sounding familiar -- want to get political by announcing early. isela merkel saying if there a renewed outbreak, the local restrictions do have to come back. johns hopkins reporting this morning that germany's infection rate is going up. we mentioned the report on 15.6%, theers at most since data collection started in 1991. i might just quickly note come on the other side of the world, china may not announce a goal ,or economic growth this year they may just give a gold instead of a numerical target. alix: and i take offense, you don't like the mullet that i am developing on my hair? michael: it is absolutely beautiful. i liked it in the 1970's. [laughter] alix: thank you. s

was not much bigger thanit covid—19 crisis was not much bigger than it was in 2004, parts of the euro zoneince the 2008 financial crisis, and italy is the most precarious large economy in the euro zone. they have a high debt burden, so thinkable he depending on tourism and on holiday activity —— depending on tourism and on holiday activity — — so depending on tourism and on holiday activity —— so it is incredibly dependent on. that's what italy and the italian government and the wider eu will hope that, as far as possible, a normal economic life can resume. we will continue our tour of europe, a german newspaper, the frank for —— frankfurter allgemeine. they are looking at america. a suggestion that unemployment may rise by up to 20%, to get up to 20%, harriet line. yeah. an implement in america was at about 4.4% in march when the pandemic and subsequent lockdown got under way and i think it is now up to 14.7% and concerns that might go up to 14.7% and concerns that might go up to 20%, which is worrying so many people. the us, like so many countries, has imposed a fairly sharp lockdown. th

germany's highest court house want the country's central bank may have to pull out of the key euro zone bond buying scheme the german constitutional court has upheld several complaints against the european central bank as project begun in 2015 to boost the euro zone's economy all says the e.c.b. must clarify that the asset buying program is not disproportion if it doesn't germany's bundesbank would be barred from participating in this deal. so what does that mean let's ask our financial correspondent conor boozman joins us from frankfurt comma will the european central bank now have to stop their huge amounts of months the acid. low get hot the asset purchases by the e.c.b. can continue at least for now that is of course the most important signal for the financial markets today and the reason why there has not been a shock reaction on the markets after the decision has come out what the german constitute constitutional court has said today though was that the bundesbank our reserve bank the national reserve bank here in germany which executes the e.c. peace asset purchases here in germa

joining us via skype from newcastle is klaus chief euro zone economist apparently an economics good to have you with this class let's start then with this deal between. 500000000000 euros a recovery fund which. paid for by all members does this mean wit we're edging finally towards fiscal union well not exactly i mean i think it's very important to keep the concepts apart here i mean a fiscal union is normally something we only distrust in a eurozone context but because this is not in your context it's more a constant you ation or an extension of the existing framework so the e.u. has a budget it runs for 7 years the vast majority of that it is covered by member states and that is required is the past year though there's one element though in which i agree sort of with with with the fiscal union perspective namely that this does imply the commission to do a one off debt issuance. but the the mechanism by which this is going to be paid back as it were is going to be it is not new it's just that is the idea is to to do this via the budget of all $27.00 member states which is obviously th

this has so many reflections of what happened to of the financial crisis on the euro zone crisis as welluse of person everything oi'i well, because of person everything on the eu pivots on that crucial relationship between france and germany here, and so far, there has beena germany here, and so far, there has been a lot of dispute between those two countries about what kind of package should be offered, should be grants, should it be loans, what period is a need to be repaid, and how should it be open here when you look at those southern european countries those same ones that struggle during the euro zone crisis, italy being the obvious example here, there has been this growing stands that they have been able to bring a package together and bring those back neck of their economies of the most fragile, they have some of the biggest debt piles, and they are in the most trouble. but again, it's come back to that crucial france germany relationship, it looks as if they are close to agreeing some kind of deal here, that will be granted based not loan based, and this is something that will b

had a little bit more of a degree of freedom versus the euro zone as far as fiscal stimulus is concerned. that is something that was probably helping the u.k. early on in this process, but i think now with the eu coming up with a bigger stimulus package, that story kind of traded, and it is more the negatives related to brexit. structurally, it is a weak currency is a large current account deficit you need to fund, and funding that is probably going to get more problematic as we hit the next round of exit uncertainty. -- of brexit uncertainty. vonnie: thank you. i do want to mention some headlines regarding boeing, which is now bouncing up 0.6%. it will start involuntary layoffs. members.ifying 6700 70 boeing starting involuntary layoffs, and notifying 6770 members. it has been working through workforce reduction in international locations, according to the company, and it is notifying the first of those in the u.s. this week. boeing once again, had been lower, now up 0.6%. let's get some global market context now with abigail doolittle. taylor: we are seeing -- abigail: we are seeing ve

context instead of just the euro zone concept let's talk about germany specifically for a moment here spent one trillion euros so phone supporting the economy some interesting data from the bundesbank that real time data is pointing to the possibility that the 2nd quarter decline in g.d.p. won't be as bad as many and they certainly thaws yeah i think that's pretty just too early to say but we can certainly say that this general thi seems to be important name that germany seems to be doing a little bit better than the rest of the major economies the 1st quarter numbers were better so it would make sense to me that the 2nd quarter number would be better as well though the epidemic has not been asked severe in germany which again means that the lockdowns have been lifted more quickly this month in may than in other eurozone economies the economy sense of that still thinks a little bit too early to say but it certainly suggests that the german economy is doing somewhat better in relative terms than in france and southern europe where you know the the outward loss and g.d.p. loss will be v

demanding the european central bank prove its bond buying scheme designed to bring stability to the euro zone is in fact legal otherwise it's threatened to stop any further monetary cooperation and the movers and raise the e.u. commission peter all of a closer look at the spat. the coronavirus pandemic is putting pressures and strains on many relationships one of those that's feeling the pinch is not between brussels and when it comes to financial burden sharing in the eurozone germany's highest court said the european central bank's corona bond plan would need to prove it was fit for purpose if the single currency is largest economy was to take part the e.u. commission boss didn't like that one bit the recent ruling of the german constitutional court to put under the spotlight to ease use of the european union the euro system and the european legal system the final word an e.u. law is always spoken in luxembourg nowhere else so with their well not quite that statement from a sort of on the line gave those that will be vying for the job of german chancellor next year when angela merkel calls

it is not so much of a difference between what is going on with the euro zone and this package.ore important for the bond market than the currency market, so i can sit and wait. he can't. he has to make a big call on this front whereas i don't because the indications on the euro are suppliant -- second generation. it falls into his domain more than mine so he has to make the big call. i don't think we are different the level ofut importance of this event is different for both of us. tom: this has been wonderful, david loom, what a great -- david bloom, what a great brief. david: have a topsy-turvy weekend. tom: "wall street week," david westin with an incredibly busy week ahead. look for that tonight on bloomberg. good morning. ♪ ♪ "bloomberghis is surveillance," tom and francine from london and new york. twitter put up a rule violation on president trump's tweet about minneapolis, saying they glorify violence and are against the rules. earned theo factdent's ire by posting checking notes next to his tweets. order limiting the protection of social media companies. joining us is

a are far from having harmonious situation in the euro zone. tom: really well said. -- frankly, mr. draghi wanted harmony as well. when you see the glide path of disinflation right now in the ave-year in europe, is that smooth and gradual and controlled function, or do we set ourselves up for junk conditions in the clear and present now? goingi don't think it is to be smooth, and i think if you look at some of the little indicators of inflation, you will see different patterns emerge. we are already talking about food price inflation in some areas. shortages of perhaps food commodities. we are talking about borders being closed, having an impact on food prices. so we might have food price inflation. generalix of the disinflation or deflationary pattern. then you get onto the question about what is going to happen in three or five years' time? the financialr crisis, when quantitative easing was introduced, people said we will have loads of inflation. we did not have inflation, we did not have consumer price inflation, but we did have asset price inflation. is that going to happen in

with negative rates across the euro zone, very low rates in the rest of the world, the cost is reallygest thing here, and it looks like that will remain very low for a long period of time, but at some point it has to be paid back. -- have an hve economic recovery that is sustainable, also associated with some sort of vaccine, markets will look at the debt k,crued from this and thin should there be an additional risk premium in bond markets, a steeper yield curve likely to see a feature in the years governments will be able to repay that debt,. , it feels like a little way off yet, and we still have to get to the trough of the economic decline before we have to be too concerned. francine: andrew, thank you so much. we we'll get back to andrew wilson of goldman sachs to talk more about fixed income and the impact of oil going negative. up next, an exclusive conversation with the e.u. trade commissioner phil hogan, a 3:00 p.m. london timet. this is bloomberg. ♪ -- francine: this is "bloomberg surveillance." we expect the german decision on qe, legality of qe. we understand the german jud

erik: we think the euro zone is going to contract about 13% this year. i saw the consensus come out the other day, we are the most bearish in the market. with think your will have a good bounceback, but so far the numbers suggest that we are not too pessimistic compared to what this year will be. the downturn is dramatic, so those who have forecasts like the imf and the oecd in the -16 -10%, if they look at the --bers asked the -6% to -10% -10%,e oecd in the -6% to if they look at the numbers, i don't see how they get to that. so we are at the very bottom of the range of the consensus forecasters. as we see macron and merkel , we are also getting the bank of england speaking as well, saying the longer the lockdown, the longer the stimulus is going to be required. while we wait for headlines, let's talk about the u.k.. the market is starting to process in -- to price in the possibility that the bank of england goes to negative rates. england cutsk of into negative territory? mr. bailey doesn't seem convinced. erik: i don't think they will, but i was just

italy and spain want support in the shape of so-called corona bones effectively shared debt between euro zone countries but illustrating the blocks north south divide the plan for each use solidarity has met opposition from germany and the netherlands. in the whole instrument we will have certainly the right balance of loans and grants this is the process where we have to negotiate with all 27 member states of course and i think this is democracy we have to speak about the detailing out the tailor made programs but all of our do agree that it is important to support the countries that are hardest hit by the virus and the economic consequences. the majority of e.u. countries have declared states of emergency in a bid to contain the virus but the lion had a warning for any government seeking to abuse those powers. we're looking very closely to how these measures are implemented when it comes to the european values indeed the freedom of speech the freedom of media for example so we stand ready to intervene immediately if this is not appropriate and time limited. for now the priority remains savi

of reasonably relaxed attitude at the moment starts to spin out of control as it did back in the euro zonerisis? can we go from zero to 100 miles per hour, and how quickly can we do it? i think you pinpointed it exactly. i think the ecb can keep things technically propped up and sort of market equality -- market liquidity ad infinitum, but as it does so it becomes political, and it is up to the political leadership of europe to decide -- this is the ultimate crisis to decide whether europe can do it or not. it is around the multi-annual framework, how much is loans, how much is grants, how that is all figured out. to me the science is just not promising. i cannot tell you the time to this. the first indication was that recent council meeting. let's wait and see. the other thing that could happen is something sudden on the political front domestically in italy that could point toward a new election, etc. it is a wait and see, but i agree that there is a trigger risk out there. guy: just getting more and more symbols of the division that exists, the divisions that exist within the euro zone.

community health workers in india who have suddenly found themselves on the front line for an extra 12 euro zone month. every morning this is how do we do 3 gets ready to work. for she has to protect herself our car and the home washed my ass as she was it's homes in her neighborhood to check her symptoms for all nobody. is doing is an activity social health activist in india also known as an actual vocal. in addition to being mean her community her educators actual workers have now been deployed as the very 1st line of defense in india's fight against school with 19 years. to reach assigned area where she conducts sobeys with other workers rajan has to either visit or fast by areas called red zones where numerous positive pieces of the wires have been detected despite this she has been provided with only one mask that she washes and uses every day. this chemical on our government every day i gather the 1st time when i was made to visit a red zone i had never gloves nor a mask we received just 33 rupees a day the government treats us worse than bonded labor a good thing to do about get away from

italy and spain want support in the shape of so-called corona bones effectively shared debt between euro zone countries but illustrating the blocks north south divide the plan for each use solidarity has met opposition from germany and the netherlands. in the whole instrument we will have certainly the right balance of loans and grants this is the process where we have to negotiate with all 27 member states of course and i think this is democracy we have to speak about the detailing out the tailor made programs but all are do agree that it is important to support the countries that are hardest hit by the virus and the economic consequences. the majority of e.u. countries have declared states of emergency in a bid to contain the virus but one ally and had a warning for any government seeking to abuse those powers. we're looking very closely to how these measures are implemented when it comes to the european values indeed the freedom of speech the freedom of media for example so we stand ready to intervene immediately if this is not appropriate and time limited. for now the priority remains sav

in part because it had not yet recovered from the 2000 8-2009 financial crisis and the euro zone crisis2010-20 12, and the italians are scarcely richer than they were 20 years ago when their country joined in the euro, and that means that the underlying performance of the economy even in good times is weak. ofduring the difficult weeks the pandemic, italians have relied on each other to support the many who have been struggling. that hardships may continue if italy's fragile economy does not recover soon. >> the former u.s. vice president and democratic presidential hopeful joe biden has publicly denied an allegation of sexual assault. the accusation made by former senate aide tara reade derail histo presidential campaign. >> it has dominated talk about the biden presidential campaign for weeks and it was not going away. former senate aide tara reade claimed she was sexually assaulted when she worked with then senator joe biden, an allegation she only made public in the last few weeks, an allegation biden could no longer ignore. >> no, it is not true. i'm saying unequivocally it never,

closing like this the bottom of the euro zone. the folks ready to cut over the hope but. also not fight over there very effectively. even over the bills which are going. to have to get us to. come i know how to let a government idea how do i do a little bit of stuff but the one thing i don't buy the how does that. change. with. what is solid or what is a little bit. more concrete or a mountainous region situated in the far north east of afghanistan. it's bordered by the hindu kush mountains and peaks some reaching close to 5000 meters. battling extreme conditions these 2 men will have to cross the only road that cuts through the a concrete or a 350 kilometer path carved into the mountains and covered by snow. if it were not for those few willing to risk taking this route people in the villages here would have to go without basic necessities such as flour salt. without these goods the inhabitants of the white concord would struggle to survive the harsh winter with temperatures often dropping below minus 30 degrees they get a good guess about what the title is something. th

and we think of you to be organized and capable and he said no we have to be the euro zone we don't thinkof ourselves in any way. so what would it be like for us? that is a very common view is a look at what is happening to britain so that eu skepticism in france but definitely on the rise now so yes it is possible with the extraordinary turbulence that comes about and to the other currencies. so many questions to the audience. but the sentiment to translate some software to ask this question because earlier about to say something more about why and how the media in this moment can you tell us more about that? >> it's not dissimilar to the white house press briefing questions. the media i did not know what to do at the beginning of this crisis. those that work in the media are the humanities graduate. and people who study art sciences do not tend to end up in the media. so there was a serious knowledge gap at the beginning of this crisis which i think took a long time to catch up to. everyone continue to play games they were playing for years. that includes gotcha. you said this now we ha

particular the euro zone wanted to see happen for a while and this is really the serious beginning of it vicky pryce it's great to get your perspective on this important story appreciate that thanks very much. a 10 day mourning period has begun in spain to remember the more than 27000 people who've done it during the current virus pandemic you can felipe and members of the government of hell the minute silence in madrid flags will be learned across the country spain is one of the hardest hit countries in europe more than $236000.00 cases from madrid months ahead it tells us more about how the country intends to greet. today's spain has one minute of silence that spanish prime minister a bit of a sunset from the spanish parliament and joined by all the official on private public and private buildings this is part of the 10 day of official mourning that was declared yesterday by capping a spanish cabinet the political parties have been longing claiming spanish prime minister to to just to begin an official in the morning in order to take she viewed to the over 27000 people that have die

global slowdown caused by the pandemic the european economy has also suffered a record fall the euro zone's g.d.p. shrank by 3.8 percent in the 1st 3 months of this year that's its sharpest quarterly decline since records began in 1995 germany said its economy could shrink by more than 6 percent this year and the president of the european central bank warned the eurozone economy could fall 'd by 15 percent china's has declined by a record 6.8 percent and japan's is also projected to contract further it already face its fastest contraction rate in 5 years at the end of 2019. all right let's introduce our panel in london greg swenson partner at investment banking firm brig mcadam in maryland robert scott senior economist at the economic policy institute and in washington d.c. jeff hauser executive director at the revolving door project at the center for economic and policy research welcome to you all jeff let me start with you many of the restrictions have been put in place in the u.s. . now you have this 4.8 percent contraction that's happened and the restrictions were put in place before th

is forecasting a major hit to the euro zone economy due to the cope at night outbreak and this comes as the european union is i a major stimulus package to save the region's economy and the coronavirus continues to pound brazil as the latin american giant is now the new epicenter of the virus we break down the toll the disease is taking there and around the globe and later. a new era of private space development lies over the rise and what the future holds for the growing sector we have an expert panel standing by with a packed show today so let's dive in. and the eurozone economy is doing worse than initially expected facing a recession as bad as the european central bank's worst case scenario according to e.c.b. president christine legarde now economic output in the block is said to contract between 8 and 12 percent this year old guard pointed out a previous estimates of the milder downturn are now out of date the e.c.b. will release official projections for economic growth and inflation in the block and next week meanwhile the european union on wednesday proposed a 750000000000 eu

to be getting off a little easier if they are able to stick to a 6 percent decline in the broader euro zone is expected to see the economy contract by 8 percent the united states is expected to see its economy shrink by 8 percent and some countries here in europe could see double digit declines and g.d.p. could have more like italy or spain that have been hit really hard by the crisis and don't have as much fiscal we way but there are a lot of risks and uncertainties surrounding this that this forecasts one of these is obviously the concerns over a 2nd wave of infections and this is obviously a huge public health concern but also it's very concerning for businesses and consumers and workers if germany does have to roll back or air hit the pause button on some of these the easing of restrictions it's expected to be happening over the next several weeks and even after the economy does fully reopen there's also this overhanging question of demand are people going to go back into into shops are they going to hold off on purchases so there's certainly a lot of a lot of potential downsides for th

constitutional court questions the legality of the european central bank monetary policy in shoring up the euro zone and threaten to stop cooperating with it to bring you the full story after the problems. in. join me every thursday on the alex salmond show and i'll be speaking to guest of the world of politics or business i'm show business i'll see you then. welcome back while germany has started to ease its border restrictions with some neighbors including france and austria will be quite so friendly towards everyone in europe the country's highest court is demanding the european central bank prove its bond buying scheme designed to bring stability to the eurozone is legal otherwise it's threatening to stop any further military cooperation and that move has embraced the e.u. commission of a takes a closer look at the spat. the coronavirus pandemic is putting pressures and strains on many relationships one of those that's feeling the pinch is not between brussels and when it comes to financial burden sharing in the eurozone germany's highest court said the european central bank's corona bond plan w

although the drop is sharp it's not as bad as analysts feared and it's better than most euro zone countries where lock downs have been longer and deeper although that is not necessarily a consolation for the german government given the state of the european economy as a whole. i believe that it will be very very important for the revival of the german economy that the european economy is recovering to its full capacity. because we are all dependent on suppliers all over europe we're dependent on exports from all over europe it's in our best interests that we do that. with berlin's tourist hot spots still eerily quiet due to travel restrictions it's a reminder that things won't fully get better anywhere in europe until they get better everywhere. well stephen bids they say from a business they've been a shocking set of numbers but a surprise no not really anthony i mean keep in mind that today the frankfurt exchange actually ended in the positive territory so everyone is expecting this and if you take a look around you can see that the streets were empty for weeks and that is starting to cha

for european bank president christine that god has warned the euro zone economy is facing a dramatic contraction of between 5 and 12 percent this year she said it was on a scale never seen in. the e.c.b. has unveiled stimulus measures to protect the economy. here in germany a new study is warning that almost half of all mid-sized companies are struggling because of the pandemic and many may not survive. rick oro is the world's leading producer of economy class aircraft seats prior to the krona pandemic it was doing well but since the sector has overwhelmingly ground to a halt the company's order numbers have plunged it's cut costs and reduced workers' hours in an effort to survive. now a major client boeing has started production again ricardo hopes that could mean orders will also soon return. germany's trade and service sectors have been especially hard hit by the crisis for many the relaxation of lockdown measures has come too late restaurant chain fabiano was already in trouble before the pandemic now has declared insolvency many fear the credit crisis could lead to a drastic sha

by jowl but i think the european union can live together with the differences that we see in the euro zone now well that if it's so minor then how do you explain the resistance i mean the resistance it's almost in the d.n.a. of northern europe. well i mean i come from the south in the united states and their resistance to the federal government is pretty much baked into the d.n.a. as well in a lot scarier than it is here in europe the issue in the european context is the extent to which we can convince everybody that they're all in one economic situation together in the end i think that that conviction is spreading that the french and the germans have come to this agreement is an important 1st sign all right eric jones of johns hopkins university and belong in italy professor jones we appreciate your time and your insights tonight thank you thank you very much for having me. and you thought your trainers or your sneakers were expensive i want you to get a load of this the basketball shoes worn by the american hoops icon michael jordan have just sold at auction for more than half a $1000000

elements those discussions on how to recover the economy in the european union in particular and in the euro zone that is something that we'll probably hear in a few minutes from both corn and merkel and this comes as european countries step by step gradually reopening and changing some of those restrictions that we have been covering both for a very long time obviously all focused on national circumstances so each country obviously making decisions based on those national circumstances so that means and now the focus more and more is on how to fight this internationally and in particular when we look at the economic aspect of it all because it is clear that the european union countries and again in particular the eurozone will suffer very hard from this crisis there are already reports that the eurozone could contract 7.7 percent this year we've also heard for example from germany's economy minister a few weeks ago that germany is preparing for his worst recession in decades so obviously now all european countries are trying to find common ways out of this in fact if you are focusing on that eco

capable and if it is difficult for you to leave we don't have to leave the eu, we have to leave the euro zone. we don't think of ourselves as organized in many way. if it is hard for you was would it be like for us? that was a common view, people who have a critique of the eu said look what is happening to britain. it is not as easy to do as you claim. eu skepticism declined in france, definitely on the rise. it is possible but i don't say i will let in any way. the turbulence would come out not least of countries have to return to other currencies. >> next question, so many questions, trying to sift through the best i can. this question is from timothy. will the crescendo of anti-media sentiment translates to any change -- i asked this question because earlier on, why and how the term is so swift in this moment. >> similar to what is happening in the white house press briefings questions. essentially, the media didn't know what to do at the beginning of this crisis. humanity's graduates, people who studied - do not tend to end up in the media. a serious knowledge gap, what happened was the s

there's a potential collapse of italy the dropping of the euro zone the failure so far to reach agreement on a package for the poorer countries within the e.u. and terms of helping them through the coronavirus of coronavirus crisis so there's a whole lot and the internal plate of the e.u. and similar the joints and government is facing economic catastrophe if it doesn't take a substantial measures to rescue the u.k. economy from the results of covert so is the interests of both sides in my view to reach an agreement and that will have to be a compromise in the number of areas but i believe a good event can and should be reached meal member of the scottish parliament thank you for joining us from alex aman show pleasure. if there had been no what old time demick then good it would still have been dominating the headlines in the united kingdom the talk ongoing but they have going nowhere fast this leads to the very real risk that there will be no deal at the end of the sensation period the dreaded no deal blanks it just one year delayed to a 7 extent than has provided us with an insight int

just another inevitable step on the road to victory this is a part of the long march the arc of the euro zone or the conflict that would cost artifact his leadership in life. chronicling the turbulent story of the struggle for a palestinian home. p.l.o. history of a revolution on al-jazeera. and . how difficult. it would be mark. if you got out in no doubt in made it. to where it are now. it dug a jamba. for to you what were dug up. thank . god you're now. body to. clean up we are man you. told the ways of the.

it seems like we had a breakthrough in terms of burden sharing within the euro zone in terms -- in theacron plan. the frugal 4 threatened to change or disrupt that. is there risk for peripheral bond yields and spreads in the periphery if we don't see their plan gaining momentum? karen: i think it will shift of the pressure back to the ecb. mean, the good thing about the recovery fund was it took some of that pressure of the ecb to provide the regionwide solution. i also think, you know, it is a really good step forward in demonstrating the solidarity, the potential solidarity. i do think it will have an impact on global investor confidence with regards to the future of the euro zone. however, i think the voices coming from, as you quoted, the frugal four, i think what will happen is this will be about tweaking the plan rather than stopping it happening. i think that particular area of disagreement as to what extent the payouts should be granted or whether they should be -- grants or whether they should be loans. i am sure we will go into stages of negotiation. but maybe that is what wi