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Demeter

(85,373 posts)
17. King Says Crisis Threatens Europe’s Economy as Stability Outlook Worsens
Fri Dec 23, 2011, 07:33 AM
Dec 2011
http://www.bloomberg.com/news/2011-12-23/king-says-crisis-threatens-europe-s-economy-as-stability-outlook-worsens.html

Mervyn King, vice chairman of the European Systemic Risk Board, said Europe’s sovereign debt crisis is threatening to hurt the real economy and the outlook for financial stability has worsened. Growth prospects “have deteriorated” since September, King, who is also governor of the Bank of England, said at a briefing hosted by the European Central Bank in Frankfurt yesterday. “Investors lack confidence to continue to provide normal levels of funding. Dependence on central banks has risen.”

The ECB loaned banks a record 489 billion euros ($636 billion) for three years on Dec. 21 to avert a credit crunch from the sovereign debt crisis. The central bank said earlier this week that the turmoil has taken on systemic proportions not seen since the 2008 collapse of Lehman Brothers Holdings Inc.

King said the outlook for financial stability has “worsened” since the last ESRB meeting in September, and while intervention by the ECB is expected to “assuage funding problems in the near term, in the longer term private funding markets must be revitalized.” Bank shares have suffered this year as borrowing costs surged in the euro region. The Stoxx 600 Banks Index has fallen 28 percent since the end of June, compared with a 12 percent decline by the Stoxx Europe 600....King also appealed to banks not to “reduce lending to the real economy” as they increase their capital levels to meet new standards set by regulators. “We are very conscious there is extreme risk aversion in private financial markets,” he said. “We want a more robust banking system so that whatever risks crystallize, whatever their source, the banking system is in a better position than 2008.”...There was “no discussion” at the ESRB meeting of any country leaving the euro area, King said. Still, “all financial institutions are advised to prepare for a wide range of contingencies,” he said.

Andrea Enria, the second ESRB vice chair who is also the chairman of the European Banking Authority, said he is “disappointed” by European leaders dithering over putting rescue measures in place, effectively delaying Europe’s bank recapitalization. “We have always been quite adamant in all occasions, also in the debate running up to the decision, that this should have been a comprehensive package,” Enria said. This includes “recapitalization, some measures -- funding guarantees -- addressing the funding problems and strengthening of the European Financial Stability Facility and of the tools to deal with the sovereign crisis.”

The ESRB, which aims to warn of brewing risks in the financial system, was set up in January as part of a new European architecture designed to ward off another financial crisis such as that which followed the Lehman collapse. Its 65- member board is headed by ECB President Mario Draghi.
Ho-Ho-Ho... Hugin Dec 2011 #1
A Little Ghost of Weekend Past Demeter Dec 2011 #2
Very telling tune CatholicEdHead Dec 2011 #71
Monti names unelected government of technocrats and bankers FROM NOVEMBER Demeter Dec 2011 #3
Senators in Italy Pass Plan for Budget Demeter Dec 2011 #15
"the absence of democratically endorsed characters will allow austerity measures to proceed dixiegrrrrl Dec 2011 #52
Europe Braces for Long Winter Demeter Dec 2011 #4
BofA Close to Settling Countrywide Probe Demeter Dec 2011 #5
Where are the handcuffs! DemReadingDU Dec 2011 #19
Illinois Attorney General Lisa Madigan has settled that lawsuit, actually. dixiegrrrrl Dec 2011 #53
A civil settlement doesn't preclude a criminal prosecution Demeter Dec 2011 #68
Sdly, as we know, the SEC settlments are not followed by criminal charges. dixiegrrrrl Dec 2011 #70
The Meme that Refuses to Die: Government Debt Must Be Paid Back by Steve Roth Demeter Dec 2011 #6
The 99% Declaration Demeter Dec 2011 #7
That's a clear plan. n/t Ghost Dog Dec 2011 #14
The 876 delegates would go to the top of DHS watch list westerebus Dec 2011 #65
Judge finds Stanford fit to stand trial Demeter Dec 2011 #8
Bini Smaghi urges bold decisions Demeter Dec 2011 #9
Bini Smaghi sees role for European QE Demeter Dec 2011 #11
US growth revised down for third quarter Demeter Dec 2011 #10
Jean Pisani-Ferry: Will Europe’s crisis reconcile Asia with the IMF? Demeter Dec 2011 #12
ESMA automated trading guidelines to take force in May Demeter Dec 2011 #13
Sir Mervyn King: debt crisis is causing a dangerous 'dependence on central banks' Demeter Dec 2011 #16
King Says Crisis Threatens Europe’s Economy as Stability Outlook Worsens Demeter Dec 2011 #17
Basel Regulators Seek to Close Loopholes in Bank-Liquidity Rules Demeter Dec 2011 #18
European Banks Rush to Grasp Lifeline Demeter Dec 2011 #23
Legality of Non Transparent Transfer of MF Global Assets to JP Morgan Questioned Demeter Dec 2011 #20
“We Own Wall Street” By Eliot Spitzer Demeter Dec 2011 #21
Dear Eliot -- Nice idea, but. . . . . Tansy_Gold Dec 2011 #45
They need to understand the whole concept of, "Noblesse oblige". Hugin Dec 2011 #67
FBI Reportedly Investigating Fannie Mae, Freddie Mac For Role In Subprime Crisis Demeter Dec 2011 #22
Where are the handcuffs! DemReadingDU Dec 2011 #24
Ann Barhardt has a different idea Po_d Mainiac Dec 2011 #64
This is not about their "role in the subprime crisis," it is about execs lying to shareholders... rfranklin Dec 2011 #50
merry christmas! xchrom Dec 2011 #25
This one's for you, X Tansy_Gold Dec 2011 #46
OMG -- that really got to me! nt xchrom Dec 2011 #47
Me, too! Tansy_Gold Dec 2011 #48
indeed -- it has the BEST ending -- nt xchrom Dec 2011 #49
and how is your Petunia? DemReadingDU Dec 2011 #54
her limp is improving every day now. xchrom Dec 2011 #55
Just give her a bit more time DemReadingDU Dec 2011 #60
i look forward to 'PETUNIA, STOP THAT RIGHT NOW!' nt xchrom Dec 2011 #63
That was a great story! and we have a similar one DemReadingDU Dec 2011 #59
the ecb's highwire act xchrom Dec 2011 #26
That game has been played for decades in 3rd world countries dixiegrrrrl Dec 2011 #57
agreed. few people would argue that developed countries were kind to africa xchrom Dec 2011 #61
south asia: Markets could recover if reforms can get a push: Analysts xchrom Dec 2011 #27
Gold down by Rs 50 on sluggish demand; silver up by Rs 150 xchrom Dec 2011 #28
Rupee ends lower, falls for 3rd straight week {this is something to watch, apparently} xchrom Dec 2011 #29
We have not shelved FDI in retail: Pranab Mukherjee xchrom Dec 2011 #33
Asian Stocks Higher As US Recovery Gains Traction Ghost Dog Dec 2011 #30
European Shares Advance Ahead Of Holiday Break Ghost Dog Dec 2011 #31
US consumer spending tepid in November xchrom Dec 2011 #34
Wall Street Pins Hopes On Economic Data Ghost Dog Dec 2011 #32
Today's Reports Roland99 Dec 2011 #35
November durable-goods orders rise 3.8% Roland99 Dec 2011 #36
Personal income rises 0.1% in November Roland99 Dec 2011 #37
Core PCE index up 1.7% over past 12 months (up 0.1% for November) Roland99 Dec 2011 #38
Durable-goods orders minus transportation up 0.3% Roland99 Dec 2011 #39
Personal spending rises 0.1% in November Roland99 Dec 2011 #40
Personal incomes rise 0.1% in November Roland99 Dec 2011 #41
Core Durable,Capital Goods Orders Miss Despite Inventory Stuffing, Push Q4 GDP Lower;Savings Down Roland99 Dec 2011 #42
New U.S. home sales rise to 315,000 rate in Nov. (Oct. revised up to 310,000) Roland99 Dec 2011 #58
Matt Taibbi: A Christmas Message From America's Rich DemReadingDU Dec 2011 #43
Karl Denninger: Matt Taibbi, Financial Schemes And The US Congress DemReadingDU Dec 2011 #44
" It seems America’s bankers are tired of all the abuse. They’ve decided to speak out." dixiegrrrrl Dec 2011 #62
For this, The Bloomberg Economic News link shall remain on the SMW OP template. Hugin Dec 2011 #66
In Portugal, All-Out Privatization Gets Underway xchrom Dec 2011 #51
Fed’s Once-Secret Data Released to Public xchrom Dec 2011 #56
This isn't a good sign. Fuddnik Dec 2011 #69
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