In BRYXeLLES: the leaders of Nations powerful G7 's raced on Sunday for a joint response to spiralling tension during the servicing of the debt crisis in the eurozone and the US rating downgrade before the opening of markets on Monday.
After stock markets suffered their worst falls since 2008 last week vacationing leaders scrambled to a flurry of phone calls from London to Paris in Washington to salvage confidence before the clock strikes in New Zealand, the first market to open in Asia.
Finance Ministers and central bankers from the G7 Nations--Britain, Canada, France, Germany, Italy, Japan and the United States — is to hold a telephone conference call and might issue a joint declaration on Sunday, Jiji Press said in Tokyo.
Officials remained tight-lipped, accepting however, about the plans in order to stave off a global meltdown, with the European Central Bank (ECB), in particular, by refusing to confirm reports of a conference telephone call Sunday evening between European Central banks.
At stake is whether the Bank of Frankfurt will step into the market to buy back debt piled up from Italy, the third largest economy and the latest possible victim of the crisis in the cavernous, also threatens Spain of the euro area.
Last week saw the borrowing cost record due to a loss of investor confidence fire over the mountain of debt — 120 percent of GDP — and poor economic growth prospects and political tensions.
I urge the ECB requires in the first step in reforms and slice the deficit, Prime Minister Silvio Berlusconi this weekend, said legislators would be called back early to rush to austerity measures, including a constitutional amendment forcing Governments to maintain balanced budgets.
Intervention by the ECB would reassure sceptical markets, convinced that "politicians have a strategy for dealing with Italy and Spain," it said, a trader at Hedden IG index.
In London, the Centre for Economics and business research last week: "Realisitically, Italy is committed to its default, but can simply get Spain away without having to do so."
As the US ratings downgrade by Standard and poor's late Friday added a week of drama, in which trillions of euros was wiped off the value of stocks, the leaders of Britain and holidaying in France, Prime Minister David Cameron and President Nicolas Sarkozy discussed the crisis over the telephone.
"Both agreed on the importance of working together, close monitoring of the situation and keep in touch in the coming days," said a spokesman for Downing Street.
Just two weeks after a special summit to offer a permanent fix cavernous debt service crisis of Europe, the panic that bites the single currency is over-hasty eurozone leaders back in action as you hone in on markets with the debt rather than banks.
European Economic Affairs Commissioner Olli Rehn said on Friday that it will be a contribution from associates of the G7 and G20 critical in efforts to resolve spiralling chaos.
Seeking to soothe tension after contagion began even to threaten France in the bond market, the EU'S Rehn rushed back to Brussels and announced he will propose a new, common "euro-bonds next month.
Up to now taboo, this would enable the eurozone governments to raise capital needed to run their countries, based on assurances from the entire blocs 17-332 country of millions of people.
The Commission, the ECB and the European financial stability facility (EFSF) are each working day night to give flesh and bones "from an agreement reached at the Summit 21 July in the euro zone.
Under the agreement in July, leaders of Nations 17 sharing the currency agreed to a second bailout for Greece just a year, this time with a one-time contribution of the private sector.
But they also become mainstream reaction to the crisis, agreeing to beef up the size of the pot to rescue — the EFSF (625 million dollars) 440-billion euro — and its powers.
The new muscle will allow the EFSF to step to help troubled banks and buy back the debt on secondary markets, as well as a first step in building something similar to a European version of the International Monetary Fund.
"This comprehensive, detailed and technically complex agreement requires time for implementation," Rehn said on Friday.
"It would be wonderful if the agreement were fully operational on 22 July," Rehn said. "But this was obviously impossible."
If national parliaments ratify the changes as quickly as hoped, new financial armor of the euro should apply from the beginning of September. "
"This is necessary — and legitimate — price for living in democracies," Rehn said.
But parliaments in certain Northern Nations, in the case of taxpayers is receptive to pay bills for the benefit of Greece, may orrwdoyn moves to increase the pot rescue size or scope.