Tag Archives: Mario Draghi

ECB saves euro, lets economy hang

By James Saft – Mario Draghi has saved the euro, for the time being, but seems less inclined to help the economies in which it is used.

With central banks in the U.S. and Japan easing aggressively, that leaves the euro liable to continue its recent gains, making countries in the currency area less able to export their way out of their problems. more> http://tinyurl.com/ctlelwz

ECB discusses rate cut, depicts bleak 2013

By Eva Kuehnen – The European Central Bank pondered an interest rate cut on Thursday and predicted the euro zone economy would shrink again in 2013, leaving the door open to a possible reduction in borrowing costs early next year.

The Council also touched on the idea of cutting its deposit rate into negative territory. By effectively charging banks for their deposits rather than paying them interest, the ECB could push banks to put their money to work elsewhere. more> http://tinyurl.com/branh8t

Leave “fairy world” behind, Draghi tells euro zone

By Daniel Flynn and Leigh Thomas – The euro zone‘s crisis is far from over and its members must tighten budgets and forge a banking union to leave behind the “fairy world” that allowed problems to grow, European Central Bank President Mario Draghi said on Friday (Nov 30).

Draghi’s call for reform was echoed by International Monetary Fund chief Christine Lagarde, who said implementing a banking union with powers to supervise all banks in the euro zone should be the currency bloc’s top priority. more> http://tinyurl.com/czsvphq

WHY IT MATTERS: Europe’s Economic Crisis

Europe 1999

Europe 1999 (Photo credit: Greg_e)

By Paul Wiseman – The issue: Europe is struggling to control a debt crisis, save the euro currency and stop a repeat of the 2008 financial crisis that sent the world spinning into recession.

Why it matters: Europe buys 22 percent of the goods America exports. U.S. companies have invested heavily in Europe.

Europeans are struggling to repair a system that was flawed from the start. The euro, introduced in 1999, makes it easier to do business across Europe; no more changing francs to deutschemarks when French and German companies do business. But the common currency joined countries with vastly different economies and political cultures — and each got to keep running its own budget. more> http://tinyurl.com/8r5rjfg

German business mood worst since mid-2009

By Alexandra Hudson and Eva Kuehnen – German business sentiment dropped for a fifth straight month in September, raising fears of recession as companies struggled with what they said was the worst economic outlook since mid-2009.

“Today’s Ifo index shows that German companies remain skeptical about the economic impact of (ECB president) Mario Draghi‘s magic,” ING Bank economist Carsten Brzeski said.

“Despite fears of a looming Eurozone break-up clearly fading away, German businesses are downscaling their expectations. The German economy could see a contraction in the third quarter.” more> http://tinyurl.com/8qyjtpp

What’s the solution to the euro crisis?

By Liz Phillips – A war of words is going on between European leaders but the noise can’t disguise the fact that they are no nearer to concrete solutions to the euro crisis. Mario Draghi, the European Central Bank‘s President, has been trying to bang together the heads of the politicians and suggesting there can be no ECB money without tighter financial controls.

Europe‘s single market is in danger of fragmenting with Greece the likeliest to leave first. But no one believes the euro as a whole will completely break up. more> http://tinyurl.com/8oc99kn

Why a Euro-Zone Crisis Can’t Be Avoided Very Much Longer

By Michael Sivy – Stocks rallied powerfully late last week after European Central Bank President Mario Draghi declared that the ECB stands ready to do whatever it takes to preserve the euro.

There are three seemingly unavoidable problems:

  • The next round of losses in Greece cannot be charged mostly to private-sector lenders
  • Austerity and ECB lending have not been able to hold down interest rates
  • The growing magnitude of the problem will run up against political constraints

Both France and the Netherlands, which supported and helped pay for previous bailouts, now have financial problems of their own. And resistance is growing in Germany against taking on further liabilities. more> http://tinyurl.com/cdajo5u