Even if rumors about a Greek departure from the eurozone have been deflated, the recent flurry of speculation should not obscure the hard facts about what Athens needs to do: shrink the country’s defense spending, privatize more public-sector activity and collect more taxes from companies and wealthy citizens. These are the conditions for energizing the country’s economy and businesses.
On April 27, 2011, Jonathan Faull, Director General for Internal Market at the European Commission, Commissioner Michel Barnier’s principal deputy, discussed the ongoing development and implementation of the EU’s ambitious financial governance reforms, the challenges that lay ahead for renewed efforts to strengthen the Single Market and assessed the prospects for greater European-American cooperation in restoring financial and economic health to both sides of the Atlantic. Richard Weiner, Partner at Sidley Austin LLP moderated the discussion.
This month is supposed to mark a turning point for the euro. Two EU summit meetings on bolstering the euro and the eurozone will happen in Brussels -- the first this Friday March 11 and the second, more important one on March 25. This week, fresh urgency was added to the crisis and the EU’s ability to restore confidence when the markets raised the interest rates being charged Portugal for its government bonds on March 9 to an all-time high that Lisbon admits is “unsustainable” as the price of rolling over its sovereign debt.
When the U.S. government led a bailout program of $700 billion in the wake of the 2008 financial crisis, the money was generally described as bailout funds for U.S. banks and other major financial institutions. But in fact, substantial amounts went to foreign banks, according to a congressional watchdog, the Congressional Oversight Panel. Headed by Elizabeth Warren, the committee has just issued a report highlighting this dimension of the Troubled Assets Relief Program (TARP).
Despite populist pressures to curtail its powers, the U.S. Federal Reserve System is now certain to remain fully independent of direct political interference in setting U.S. monetary policy. Moreover, its supervisory and regulatory powers will be extended to non-bank financial institutions (although it will have to work more collegially with other Federal regulators in this area).
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