An exchange traded fund that follows German stocks is the worst single-country ETF performer in August. The fund has lost nearly 20% on the Eurozone debt crisis and questions about the future of German Chancellor Angela Merkel.
Merkel is short on coalition votes, which is raising questions about the European financial bailout.
According to Ambrose Pritchard of The Telegraph, German media reports that the latest tally in the Bundestag shows 23 members from Merkel’s coalition plan to vote against the package. If Merkel relies on opposition votes, a government crisis could occur. [Europe ETFs Fall as Short-Selling Ban Extended]
“Decisions have to be made in Parliament in a liberal democracy. That is where legitimacy lies,” said Christian Wuff, Germany’s president, in the report. [Germany ETF Underperformance Suggests Trouble for the Euro]
A decision should be made at the end of next month which determines if the European Financial Stability Facility (ESFS) has the power to buy bonds and recapitalize banks.