The proposed creation of a single euro-zone bank supervisor is shaping up to be
a test of the willingness of countries to give up national powers for the sake
of the euro. Though still in its infancy, the effort—which envisions a key role
for the European Central Bank in supervising the bloc's largest and most
internationally active banks—faces hurdles as officials try to streamline a
patchwork of regulators and supervisors numbering in the dozens. German central
bank officials are reluctant to add another responsibility to the ECB that might
weaken its anti-inflation vigilance. French bank executives worry that a
Europe-wide supervisor wouldn't take into account the unique ownership structure
of some banks. Behind a painted fence, the new European Central Bank building
rises in Frankfurt. A banking supervision plan sees a key role for the ECB. "It
will be a test case, so they'd better pass the test, otherwise it would put euro
area in danger," says Daniel Gros, head of the Center for European Policy
Studies, a think tank in Brussels. German Chancellor Angela Merkel has made the
creation of a new euro-zone banking supervisor under the aegis of the ECB a
precondition for agreeing to let Europe's bailout fund re capitalize banks
directly, rather than indirectly via loans to national governments. Such a
European financial backstop for banks would alleviate pressure on countries with
banking crises, such as Spain and Ireland, and would correct one of the
omissions in the design of the euro that economists say has made the currency
union unstable. Creating a single supervisor would require countries to give up
some of their sovereignty over how their banks are regulated.
Access Investments-Building Awareness - European Union-ROMANIA
Wednesday, July 25, 2012
The proposed creation of a single euro-zone bank supervisor is shaping up to be
a test of the willingness of countries to give up national powers for the sake
of the euro. Though still in its infancy, the effort—which envisions a key role
for the European Central Bank in supervising the bloc's largest and most
internationally active banks—faces hurdles as officials try to streamline a
patchwork of regulators and supervisors numbering in the dozens. German central
bank officials are reluctant to add another responsibility to the ECB that might
weaken its anti-inflation vigilance. French bank executives worry that a
Europe-wide supervisor wouldn't take into account the unique ownership structure
of some banks. Behind a painted fence, the new European Central Bank building
rises in Frankfurt. A banking supervision plan sees a key role for the ECB. "It
will be a test case, so they'd better pass the test, otherwise it would put euro
area in danger," says Daniel Gros, head of the Center for European Policy
Studies, a think tank in Brussels. German Chancellor Angela Merkel has made the
creation of a new euro-zone banking supervisor under the aegis of the ECB a
precondition for agreeing to let Europe's bailout fund re capitalize banks
directly, rather than indirectly via loans to national governments. Such a
European financial backstop for banks would alleviate pressure on countries with
banking crises, such as Spain and Ireland, and would correct one of the
omissions in the design of the euro that economists say has made the currency
union unstable. Creating a single supervisor would require countries to give up
some of their sovereignty over how their banks are regulated.
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the Troika as a whole was quietly backing away from further pouring of real money into the Greek debt-pit. I think that was right, but what Evans-Pritchard points out in today’s piece is that the IMF itself sees no end to the Brussels catatonia – and thus sees no point in sacrificing its ‘reputation’ on the altar of The Church of the Holy Belgian Empire.
For IMF, we can still largely read ‘Washington & the US Fed’, because whatever one makes of DSK’s demise, it resulted in the mathematically challenged Doris Lagarde getting the top job – a skilful melange of media management and threats from Tim Geithner having ensured that she would be the winner. Strauss-Kahn was, after all, a French Leftie; whereas Lagarde was and is “our gal”. DSK’s troops have been quietly sidelined since her arrival, and the Frenchman’s collectivist leanings dumped in favour of austere growth – surely the funniest oxymoron in economic history.
the Troika as a whole was quietly backing away from further pouring of real money into the Greek debt-pit. I think that was right, but what Evans-Pritchard points out in today’s piece is that the IMF itself sees no end to the Brussels catatonia – and thus sees no point in sacrificing its ‘reputation’ on the altar of The Church of the Holy Belgian Empire.
For IMF, we can still largely read ‘Washington & the US Fed’, because whatever one makes of DSK’s demise, it resulted in the mathematically challenged Doris Lagarde getting the top job – a skilful melange of media management and threats from Tim Geithner having ensured that she would be the winner. Strauss-Kahn was, after all, a French Leftie; whereas Lagarde was and is “our gal”. DSK’s troops have been quietly sidelined since her arrival, and the Frenchman’s collectivist leanings dumped in favour of austere growth – surely the funniest oxymoron in economic history.
Another official pointed to the latest growth estimates from Athens, which show the economy contracting by 7% this year rather than the 5% previously forecast, meaning that the debt burden is only increasing in relation to GDP.
Well of course it bloody well is! How can there be any kind of growth in Greece whilst these crippling austerity measures are imposed upon them? It is impossible for Greece ever to repay these debts and the twats from Brussels and the IMF know this - so why are they continuing with this disastrous policy? Quite frankly I think they are engineering a Greek default and it would be kinder for the Greeks if they simply came out and said so rather than this slow torturing to death. Ordinary, decent working people are seeing their lives ruined, families living on the streets, people committing suicide while the world's bankers continue to live it up and sponge off the rest of us.
Many investors are running away from Europe like it is the plague, but hedge fund billionaire Marc Lasry is bucking the trend.
His fund Avenue Capital Group finished raising almost $3 billion for a fund that will invest in European corporate bonds, The New York Times reported. And he has his own skin in the game – to the tune of $75 million.
That looks like a pretty bold bet, given that the euro fell to a two-year low Monday, Spanish government bond yields rose to record highs and fears rose that Greece will not be able to meet the terms of its bailout.
Read more: Hedge Fund Billionaire Lasry Bets on European Bonds
Spain claimed Italy and France back a plan for the immediate implementation of measures agreed last month.
These include aid directed at Spain's banks without adding to national debt.
Spain said there had been a "worrying delay" in executing the agreements thrashed out at the eurozone leaders summit on 29 June.
The main provision would be to allow the future European bailout fund, the ESM, to pour money directly into ailing banks such as those in in Spain, circumventing national governments.
The creation of the fund has been hampered by constitutional challenges in Germany which mean Berlin will not be able to ratify the agreement before 12 September.
"Speed is an essential condition for the success of any European action," the statement released by the Spanish foreign ministry said.
But, France's European Affairs Minister Bernard Cazeneuve denied any accord with Italy and Spain on immediate implementation.
"It makes no sense to say that. We are following the decisions taken at the European summit and are working on them," said Mr Cazeneuve.
The Italian government also categorically denied that it was part of any joint initiative with Spain.
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