Buy My IOU – Sell Your Government IOU For CASH

The stress test on banks has failed to calm nerves over Europe’s debt crisis

Stock markets fell on Monday as a healthcheck on banks failed to stem worries about Europe’s debt crisis.

Financial shares were heavy fallers, with Royal Bank of Scotland down 3.8% and BNP Paribas 3.1% lower.

In early trading the FTSE 100 index fell 0.9%, France’s Cac 40 shed 1.4%, and Germany’s Dax was 1.3% down.

On Friday, five European banks failed a stress test on their finances, while another 16 were said to be near the danger zone.

Meanwhile, the price of gold topped $ 1,600 an ounce for the first time as investors put money into the haven commodity.

Concerns among investors have also been fuelled by the Obama administration’s failure to agree a debt-ceiling deal.

The US risks defaulting on its debts unless Congress can agree new rules that will allow Washington to borrow more money.

The euro has fallen and the borrowing costs for Spain and Italy rose

European stock markets fell heavily on Monday, weighed down by fears that the eurozone’s debt crisis was spreading.

In late afternoon trading, Italian shares were down more than 4%, France’s Cac index fell 3%, Germany’s Dax fell 2%, and London was down 2%.

Banks across Europe were hit hard, with Italy’s Unicredit down 10%.

Eurozone finance ministers were holding talks on a new aid plan for Greece, but this was overshadowed by fears of contagion spreading to Italy and Spain.

The euro fell, while borrowing costs for Spain and Italy rose to 12-year euro-era high.

“There are tensions across the eurozone, we must find a solution,” Belgian minister Didier Reynders said to reporters on arrival at the finance ministers’ meeting.

The EU wants increased competition to push down prices for consumers

New rules aimed at cutting the price of using a mobile phone while travelling in the EU have been proposed.

The move, by the European Commission, would reduce the costs of “roaming” – when calls are made or received, text messages sent or data downloaded when travelling in Europe.

New, lower price caps could come into force in stages to July 2014.

By then, mobile phone customers would also be able to separate their national and overseas contracts and shop around.

They would still be able to use their same phone number, but could switch to a separate operator when in another country for a cheaper deal.

At present, mobile users can buy a Sim card local to the country in which they are travelling, but this means they are on a different phone number to usual.

The Commission hopes that more “virtual” operators, which do not have their own networks, would enter the roaming market. The extra competition would then be expected to push down prices.

‘Outrageous margins’

In the meantime, proposals have been published that would extend the level of price caps on calls and text messages for those travelling in Europe.

Current EU roaming price caps will expire at the end of June 2012. The authorities fear that without putting more plans in place, prices could pick up to pre-2007 levels.

For example, there is currently a cap of 35 euro cents (31p) a minute on calls made. The proposals would see this falling steadily to 24 cents (22p), by July 2014.

There is currently no cap on downloading data, but this would be limited to 50 cents (45p) per megabyte by July 2014, under the Commission’s plans.

“This proposal tackles the root cause of the problem – the lack of competition on roaming markets – by giving customers more choice and by giving alternative operators easier access to the roaming market,” said Neelie Kroes, European Commission Vice President for the Digital Agenda.

“It would also immediately bring down prices for data roaming, where operators currently enjoy outrageous profit margins.”