(FT) -- Europe's leaders face fresh splits over how to tackle the eurozone's escalating crisis after being urged to create as rapidly as possible a vast market for joint European government bonds, a move almost certain to be blocked by Germany.
Jean-Claude Juncker, Luxembourg's prime minister who also chairs meetings of eurozone finance ministers, and Giulio Tremonti, Italy's finance minister, argue in Monday's Financial Times that the launch of "E-bonds" would send a clear message to financial markets and European citizens about the "the irreversibility of the euro".
They say the market for such bonds should become the most important in Europe and as liquid as that for U.S. Treasuries.
However, Germany's Wolfgang Schäuble -- on Monday named as the FT's European finance minister of the year -- said in a video interview that jointly guaranteed bonds would require "fundamental changes" in European treaties. He added that it was also key that governments had incentives to maintain discipline over finances -- and faced sanctions when they did not. "Otherwise the euro would fail," he warned. Germany also fears the issuance of joint bonds would raise its borrowing costs. CNN
