German Constitutional Court offers Merkel a day of hope and happiness

KARLSRUHE, Germany – Germany’s Federal Constitutional Court on Wednesday gave Chancellor Angela Merkel a significant victory in her bid to master the debt crisis that has buffeted the continent for years and endangered its common currency, granting approval to one of the key pillars of her strategy.
With the ruling, the 17 countries of the euro zone will be able to move ahead with the establishment of the European Stability Mechanism, something like a continental version of the International Monetary Fund. The mechanism will handle bailouts and work in tandem with the European Central Bank to buy the bonds of countries such as Italy and Spain that are straining under high interest rates.
The court ruled that Germany could proceed with its contribution to the mechanism but set certain conditions, including a requirement for parliamentary approval of any increase in the agreed German contribution of 190 billion euros, or about $240 billion.

Source: NYT