European Bailout Drawing From From ESM, What ESM?

These events in Europe are not going away, they simply can't until the real issues are dealt with. How is lending more money going to solve anything?

From Phil Davis today:

 "From what we know, the eurozone's leaders aim to deploy the European Stability Mechanism (ESM) to cap borrowing costs for Spain and Italy by purchasing sovereign bonds on the open market.  Unfortunately, the ESM fund does not yet exist. It has not been ratified by Germany and Italy. When it does come into being, it won't have much money.  It has a theoretical limit of €500bn — a nice wish — but its paid up capital will start at just €22bn.

Britain's George Osborne cautioned against exuberance. "One thing we have learnt is: don't expect a single summit to solve the eurozone's problems, otherwise you are going to be disappointed. The eurozone is inching towards solutions."

They are promising, yet again, to fix the problem.