NEW OPINION POLL SHOWS RISING VOTER OPPOSITION TO GREEK BAILOUT IN BUNDESREPUBLIK

Greek debt ‘not big enough to need aid’ says Wilhelm.

“We assume that Greece is in a position to solve its problems itself with its consolidation programme,” senior Merkel spokesman Ulrich Wilhelm said last night. If so, why have the single currency and Franco-German relations been in such a state for the last fortnight?

Perhaps Germans aren’t as good as us when it comes to spin; either way, uncertainty and contradiction continues to emanate sporadically from the German capital. Angela Merkel lauded Greek Prime Minister George Papandreou’s efforts to cut his budget deficit to 8.7 percent of GDP in the Reichstag. She dubbed his measures “a real achievement”, but the conciliation being pressed upon her now doesn’t fit with German opinion polls showing a massive majority on favour of giving nothing to help Greece out. Later she seemed to contradict herself by saying that ‘the price’ for German help would be ‘more discipline and less superficiality’ when it comes to currency union.

Specifically, the Government’s position on the IMF also remains all over the place. Merkel said last Friday she wouldn’t rule out a loan to Greece from the IMF, but a spokesman for finance minister Schauble admitted to ‘grave reservations’ about such aid within the Finance Ministry.

France remains more committed to helping the Papandreou Government, but then France has more to lose from the abandonment of internal EU help for members in trouble. I hear that Sarkozy has torn a strip off all his Ministers involved in making statements on the situation, ordering them to clear anything through him first. So far, the ban on tit-for-tat seems to be holding; but there is little or nothing for the markets to be reassured about in any of this.

“For anyone with commonsense,” said one credit manager to The Slogger yesterday, “this isn’t going to end here, and it isn’t going to end in Greece. As the problem spreads, a firm hand will be needed to present a coherent front to the markets. Thus far I see zero signs of that happening.”