EU Treaty vetoed by UK Prime Minister David Cameron

David Cameron Vetoes EU Treaty17 nations that use the euro came together to sign a treaty, allowing a central European authority to have closer insight of their budgets, sending stocks up sharply as a result. There are nine other European nations considering coming on board, with Britain being the only holdout.

In a two day summit in Brussels, involving some marathon talks that lasted into the early morning hours of Friday, it was determined that there would need to be a much tighter fiscal control in place before the European Central Bank committed to releasing more money which would lower the borrowing costs of nations in serious debt such as Spain and Italy.

While the financial stocks did the best, all stocks across the board showed great improvement in light of this newest plan to help the debt crisis. Policymakers are also aiming to bring the European Stability Mechanism, the new bailout fund, online in July of 2012, which will bring the total combined rescue power to about 500 million Euros.

Although it is just one minor step in what needs to be many steps towards a solution, It IS a step and one that most of the nations involved in are willing to make.

Ryan Detrick, senior technical strategist with Schaffer’s Investment Research, states in a Washington Post interview, “We’ve seen these agreements before, and they can just as easily deteriorate.” So they’re not in the clear yet, but what is clear is that, with the exception of Britain, all of the other 26 nations want to come to some solution that will help ease their economic crisis.

While Britain and those other nations may want the same positive economic outcome, it’s not certain why they are not in favor of the pact, nor why some of the nations are hesitating to get on board right away. When everyone can work together towards a common goal, much more is accomplished.

The rate in which stocks went up as a result of the 17 nations who DID sign, show that there is hope that this will be the first of many positive steps in the right directions for the debt crisis’s these nations are facing right now and that is a good thing as well.

Will all these positive stock increases and good will towards working together towards a common goal continue? That is the hope of these nation’s officials, but only time will tell. In the mean time, there are still things to be worked on, and all of the 17 eurozone economies were placed on a warning by Standard and Poor, the ratings firm that threw the US markets for a loop when they acted on a warning they issued to the United States, to downgrade the credit ratings system if the U.S didn’t straighten themselves out.

They have issued the same warning to these 17 nations that if the economies don’t get their fiscal houses in order and under control, ratings cuts could be coming. Standard and Poor has already proven they mean what they say.

You can watch the video below as the French President criticizes Prime Minister David Cameron of the UK as Mr. Cameron said he didn’t see safeguards for Britain’s interests in the proposed treaty:

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