News / Economy

US, European Stocks Plunge, Borrowing Costs Rise

A stock exchange monitor displays the market trends in Milan, Italy, November 9, 2011.
A stock exchange monitor displays the market trends in Milan, Italy, November 9, 2011.

Major U.S. and European stock exchanges plunged Wednesday and Italy's borrowing costs jumped, as the long shadow of the continent's debt crisis consumed the Greek and Italian governments.

Key stock markets in New York, London, Paris and Frankfurt all slid more than two percent, in part due to the political uncertainty in Athens and Rome.

Late in the day, outgoing Greek Prime Minister George Papandreou told a national television audience that he and opposition lawmakers had reached an agreement on a coalition government. The interim government will now have to carry out austerity measures demanded by the country's international creditors.

Papandreou pledged that Greece would do "whatever is required to remain" in the 17-nation bloc that uses the euro currency, and that the coalition government signals "a new future for our country."

Meanwhile, the Italian government faced record-high borrowing costs the day after Prime Minister Silvio Berlusconi said he would resign as soon as Parliament enacts budget cuts. The spending reforms are aimed at cutting the Rome government's massive debt in hopes of avoiding the need for an international bailout.

Interest rates on Italian government bonds topped 7 percent for the first time since the advent of the euro currency in 1999. That percentage rate is the threshold at which Greece, Ireland and Portugal all were forced to secure international bailouts in the last year and a half.

Greek news accounts said that 60-year-old Parliament chief Filippos Petsalnikos has been tapped as the interim prime minister after early speculation had centered on Lucas Papademos, an economist and former vice president of the European Central Bank.

Papandreou and opposition leader Antonis Samaras had been locked in talks since Monday on who will lead a power-sharing government until early elections, tentatively scheduled for February 19, are held.

Europeon Debt to GDP Ratio

The European Union demanded that both Papandreou's socialists and Samaras' opposition New Democracy party sign a written commitment to carry out the austerity measures as part of the debt-relief plan approved for Greece last month. Samaras balked at a written statement, calling it an insult to "national dignity" and insisting his verbal assent to the plan should be sufficient. It was not immediately known whether the dispute was resolved.  

European finance ministers are waiting for the formation of a new government in Greece before deciding whether to grant the country a crucial $11 billion loan installment.  

In Italy, one opposition lawmaker, Giuseppe Fiorini, said the country needs a government that can give Italy "international credibility," something he said Berlusconi has not been able to do.

"With the crisis continuing and Italy in pain I hope we can find a government that will give us international credibility and allow the country to provide the necessary reforms, which Berlusconi has not been able to give,'' said Fiorini.

One government debt analyst in London, Jan Randolph of IHS Global Insight, said investor concerns about the safety of Italian debt will not abate "until a solid and stable government actually implements austerity and undertakes reforms."

Some information for this report was provided by AP, AFP and Reuters.

You May Like

Philippines, Muslim Rebels Try to Salvage Peace Pact

Peace process faces major setback after botched military operation to find terrorists results in bloody gunbattle between government forces, Moro Islamic Liberation Front fighters More

Republicans Expect Long, Expensive Presidential Battle

Political strategist says eventual winner will be one who can put together strongest coalition of various conservative groups that make up Republican Party More

Video New Wheelchair Is Easier to Use, Increases Mobility

Engineers have come up with a lever-operated design that makes use of easily accessible bicycle technology More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Liberia's Almost Last Ebola Patient Grateful but Still Grievingi
X
Benno Muchler
March 26, 2015 3:41 PM
Beatrice Yardolo was to make history as Liberia’s last Ebola patient. Liberians recently started counting down 42 days, the period that has to go by without a single new infection until the World Health Organization can declare a country Ebola-free. That countdown stopped on March 20 when there was another new case of Ebola, making Yardolo’s story a reminder that Ebola is far from over. Benno Muchler reports from Monrovia.
Video

Video Liberia's Almost Last Ebola Patient Grateful but Still Grieving

Beatrice Yardolo was to make history as Liberia’s last Ebola patient. Liberians recently started counting down 42 days, the period that has to go by without a single new infection until the World Health Organization can declare a country Ebola-free. That countdown stopped on March 20 when there was another new case of Ebola, making Yardolo’s story a reminder that Ebola is far from over. Benno Muchler reports from Monrovia.
Video

Video Cambodian Land Grabs Threaten Traditional Communities

Indigenous communities in Cambodia's Ratanakiri province say the government’s economic land concession policy is taking away their land and traditional way of life, making many fear that their identity will soon be lost. Local authorities, though, have denied this is the case. VOA's Say Mony went to investigate and filed this report, narrated by Colin Lovett.
Video

Video US, South Korea Conduct Joint Military Exercises

The Eighth U.S. Army Division and the Eighth Republic of Korea Mechanized Infantry Division put on a well orchestrated show of force for the media this week during their joint military training exercises in South Korea. VOA’s Seoul correspondent Brian Padden was there and reports the soldiers were well disciplined both in conducting a complex live fire exercise and in staying on message with the press.
Video

Video Space Program Status Disappoints 'Last Man on the Moon'

One of the films that drew big crowds last week at the annual South by Southwest festival in Austin, Texas, tells the story of the last human being to stand on the moon, U.S. astronaut Eugene Cernan. It has been 42 years since Cernan returned from the moon and he laments that no one else has gone there since. VOA’s Greg Flakus reports.
Video

Video Young Filmmakers Shine Spotlight on Giving Back

A group of student filmmakers from across the United States joined President Barack Obama at the White House this month for the second annual White House Student Film Festival. Fifteen short films were officially selected from more than 1,500 entries by students aged 6 through 18. The filmmakers and their families then joined the president and a group of celebrities for a screening of their films. VOA’s Julie Taboh reports.
Video

Video VOA Exclusive: Interview with Afghan President Ashraf Ghani

Afghan President Ashraf Ghani, during his first visit as president to Washington, gave a one-on-one interview with VOA Afghan Service reporter Said Suleiman Ashna, about his request for a change in U.S. troop levels, the threat from the Islamic State, and repairing relations with the United States and Pakistan. The interview was held at Blair House, late Sunday, in Pashto.
Video

Video California Science Center Tells Story of Dead Sea Scrolls

The ancient manuscripts were uncovered in the mid-20th century, and they are still yielding clues about life and religious beliefs in ancient Israel. As VOA's Mike O'Sullivan reports, an exhibit in Los Angeles shows how modern science is bringing the history of these ancient documents to life.
Video

Video Angelina Jolie Takes Another Bold Step

Hollywood actress and filmmaker Angelina Jolie has revealed she had her ovaries and fallopian tubes removed to lower her odds of getting cancer. Doctors say the huge publicity over her decision will help raise awareness about the importance of cancer screening. VOA’s George Putic has more

All About America

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More

World Currencies

EUR
USD
0.9211
JPY
USD
119.18
GBP
USD
0.6722
CAD
USD
1.2509
INR
USD
62.518

Rates may not be current.