After a quiet few weeks, political pressures are rising again in Europe. Petrol bombs exploding in Athens and news reports of mounting support for the rightist Golden Dawn party bring into questions the durability of the summer stabilisation in the EZ.
Protests, riots, rightists rage in Europe – but to no ill effect
Jacob Funk Kirkegaard, 8 October 2012
The case for euro deposit insurance
Daniel Gros, Dirk Schoenmaker, 24 September 2012
The European Commission (2012) has now presented its legislative proposal for a banking union whose key element is a ‘Single Supervisory Mechanism’ to be headed by the ECB, but it says nothing about deposit insurance at the national level. Is that viable?
Banking union: A federal model for the European Union with prompt corrective action
Jacopo Carmassi, Carmine Di Noia, Stefano Micossi, 20 September 2012
The European Commission has published its proposals for the transfer of supervisory responsibilities to the ECB providing a comprehensive and courageous ‘first step’ towards a European banking union (the other steps being European deposit insurance and resolution procedures).
The commission’s proposal on bank supervisory powers for the ECB
Vincent O'Sullivan, Stephen Kinsella, 20 September 2012
Proposals from the European Commission (2012a) would give sweeping powers to the ECB in potentially the biggest shake-up in financial supervision since the creation of the Federal Reserve System in the US almost a century ago.
Expectations and asset prices: Keynes meets Hayek
Giovanni Cespa, Xavier Vives, 18 September 2012
The financial crisis has vividly put into question the alignment of asset prices and fundamental values.
On banking union, speak the truth
Charles Wyplosz, 17 September 2012
The European Commission has produced an interesting proposal on EZ banking union (Commission 2012). Despite its many shortcomings, it is a good start. And now finance ministers have started to deconstruct the proposal. Part of the deconstruction comes from the ministers’ shameful capture by national bank lobbies, but not all. The proposal includes some clumsy features.
What explains high interest rates in Europe? On creditor seniority and sovereign bond markets
Frank Westermann, Sven Steinkamp, 22 August 2012
Interest rate spreads in Europe have evolved in a way that most researchers find hard to reconcile with the underlying economic fundamentals.
ECB limited and conditional lending is not 'what it takes'
Piero Ghezzi, 19 August 2012
There is broad agreement that the ECB is going to be the main actor in the potential resolution of the peripheral debt crisis. In principle, there are two avenues that the ECB could pursue in its efforts to avoid a full-blown crisis. First, it could ease monetary policy sufficiently to weaken the euro and generate inflation to facilitate growth.
ECB: No free lunch
Marco Annunziata, 14 August 2012
Disappointment in the financial markets at Draghi’s latest press conference was predictable, understandable – and misguided. You could measure it by the movement in the euro-dollar rate, with a hopeful spike quickly followed by a despondent plunge as the press conference unfolded.
Draghi’s main messages can be summarised as follows:
Thanks to the ECB
Charles Wyplosz, 30 July 2012
On Thursday, the President of the European Central Bank, Mario Draghi, created a buzz by saying that the central bank “is ready to do whatever it takes to preserve the euro. And believe me, it will be enough.” This was enough to send the euro up and bond spreads down. But what was Draghi really saying? Very smart things, in fact, for the third time.
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