Don't Worry, Someone Will Pay My Bills

Talk about promising to pay with someone else's money.  Undeterred by the fact that chancellor Merkel, and the German Supreme Court continue to reject shared liabilities (aka eurobonds), European Commission President Jose Barroso, whose country is already on life support from the eurozone, has decided it is time for eurobonds.

How does a eurobond work, you asked? The 17 countries would be liable for payment of interest and principal.  So, Portugal (Mr. Barroso's country, currently unable to borrow in the public markets) would be able to borrow money in the public market using the eurozone's (i.e. Germany's) credit. 

Does this make the Germans nervous? It should.  If it goes through it will probably drag Germany's credit with Italy's as the German treasury would be co-responsible for the debt issued by their spendthrift neighbors.

In another example of paying with someone else's money, the press insists of the story about China using reserves to "save" Italy.  Never mind that

the Chinese premier said economies “must put their own houses in order” and not rely on bailouts from China. 

Or that China has already bought Portuguese, Greek, and Spanish bonds to no avail (they bought small amounts).  The financial press likes  this story and they are sticking by it.  Why let the facts  get in the way of  good literature.