September 26, 2011
European officials are debating ways to boost the firepower of their financial-bailout fund after the world's finance ministers, worried about the potential for a market meltdown, ratcheted up pressure on euro-zone officials to act.
During meetings of the International Monetary Fund in Washington over the weekend, the U.S. and other major nations pressed European leaders to increase the effective size of their €440 billion ($594 billion) rescue fund to perhaps trillions of euros by borrowing against it.
The talks are at a early stage, and it is far from clear they can forge a political consensus to act. German officials say the idea is moot as long as the European Central Bank continues to reject it. Some European officials hope the central bank might soften its stance under incoming president Mario Draghi, but his views on the issue aren't known.
U.S. officials are urging quick action to calm the markets, but public opposition from Germany and Northern euro-zone countries suggests no agreement is likely before the Group of 20 industrialized and developing economies meet in early November.
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