Fear Factor

EU Sets Up Stabilization Fund

Hoping to put an end to a rapid decrease in the euro's value, European leaders are setting up an emergency fund to stabilize countries facing debt crises. The common currency plunged 4.3 percent this week, the biggest decline since October 2008, amid fears that the EU had failed to contain an economic meltdown in Greece. The fund, the size of which has not been disclosed, is designed to reassure investors that other countries facing financial trouble, such as Portugal and Spain, won't bring the EU down with them should the situation worsen. “When the markets re-open Monday, we will have in place a mechanism to defend the euro,” said French President Nicolas Sarkozy. “If you don’t think that’s significant, you haven’t been to many EU summits.”