The European Debt Crisis Will Cause Multiple Default In Member Countries Of The Euro Area.

Moodie, 28, issued a report warning.

Misfortunes never come alone.

27, the market is widely rumored that Italy will seek assistance.

Although the news was denied by the euro zone and the International Monetary Fund (IMF) on the 28 day, the market panic on the European debt crisis escalated further.

In the wake of the European debt crisis, the market looks forward to breakthroughs in Euro and EU finance ministers held on 29 and 30 respectively.

Determining the details of EFSF leverage expansion, the latest EU fiscal discipline, and further discussing the details of Euro bonds have become the three expectations of the conference.

The euro zone was swept away by Moodie.

28, Moodie said, "once a member of a eurozone member defaults or withdraws from the euro area, it will greatly increase the possibility of more member states leaving the euro area, and the loss will not only be confined to the countries leaving the euro zone".

Moodie, chief ratings officer of Europe, Middle East and Africa, Alastair Wilson and global sovereign risk manager Bart Ottewell De, said in the report that the split of the euro zone will have a serious negative impact on the credibility of the entire euro area and even the EU Member States and EFSF. The rapid deterioration of the European debt crisis and the banking liquidity crisis poses a threat to the rating of all European countries' government bonds.

Moodie believes that the EU needs political impetus to implement effective crisis resolution plan, but this impetus can only be achieved after a series of turbulence, and turbulence may lead to the loss of financing capacity of the euro area member states.

In recent weeks, the possibility of a more negative outcome of the European debt crisis has increased, mainly reflected in political uncertainty in Greece and Italy and the deterioration of the euro zone's economic prospects.

Italy is embroiled in "rescue" storm

According to Dow Jones newswires, citing 28 euro zone and IMF officials, both sides said that the report on IMF's possible assistance to Italy is "not credible".

Italy newspaper "news" 27 quoted IMF sources reported that the organization may provide 400 billion to 600 billion euros in aid to Italy, to support the new Italy Prime Minister Monti in 12 to 18 months to implement reforms, restore market confidence.

According to the report, the specific provision of IMF includes loans to Italy from 4% to 5% interest rates, which is significantly lower than the 10 year treasury bonds between Italy and 7% to 8%.

It is also reported that the government of Italy plans to announce the details of the latest fiscal tightening policy in December 5th.

Earlier this month, Italy's new government promised to implement a series of austerity and reform measures to stimulate economic growth and restore budget balance.

Analysts believe that in order to quell the market tension on the debt problem of the country, Monti needs to announce policy details as soon as possible.

According to Italy media reports, the specific measures announced by the government in December 5th may include adjusting housing tax, sales tax, value-added tax rate of catering industry, and raising the retirement age.

Finance ministers will focus on three hotspots

According to Bloomberg reports, the euro zone is expected to finalize the details of the EFSF operation this week. Specific measures may include the possibility that EFSF will provide about 20% to 30% guarantees for the highly indebted member states in the euro area, which will be issued in the form of tradable partial protection certificates (SPV).

This may extend the size of EFSF to 3 times the original 440 billion euros.

In the future, EFSF may also be given the power to buy member state bonds in the two tier market, set up credit investment funds, sell short-term debt and so on.

In addition, according to Reuters, Germany and France, the two core members of the euro zone, are leading the eurozone to reach a new fiscal policy agreement, which will strengthen the fiscal discipline of euro zone member states and give the European Commission more power to budget for Member States.

The agreement is expected to be announced early before the December 9th EU summit and formally implemented in early 2012.

The third hot spot of market concern is the prospect of euro bond.

Last week, the European Commission announced three proposals for the issuance of Euro bonds. However, the issuance of Euro bonds at this stage is still strongly opposed by Germany.

The European think-tank, the European Economic Cooperation Organization (ELEC) 28, suggests that the EMU Bond Fund can be established as a pitional plan for the issuance of Euro bonds.

ELEC recommends that the fund will be open to all Member States of the euro area, and that countries can gather their short-term loans through this fund in a specific way to reduce the financing pressure of highly indebted countries.

According to the German "Le Monde" 28 reported that the euro zone AAA rating countries seem to have abandoned the idea of rescuing the highly indebted countries in the short term, and began to plan the way of self preservation.

Germany and the euro zone 5 other countries with AAA ratings - France, Finland, Holland, Luxemburg and Austria - are considering joint issuance of bonds.

Joint bond funds are used not only for the 6 countries, but also for highly indebted member countries under strict conditions.

But this bond is not the "Euro Bond" issued jointly by the 17 countries of the euro area, but the "elite bond" or "AAA bond". The core purpose is to stabilize the AAA rating of the 6 countries.