Poul Thomsen, head of the IMF mission to Greece
On Friday, after much of Europe shut down for the week, the International Monetary Fund issued its 231-page report on Greece’s new €174bn bailout, which seems to struggle to keep an optimistic tone about Athens’s ability to turn itself around over the course of the rescue plan.
But the IMF report is worth scrutinising for reasons beyond its gloomy prose: If there’s anyone who might force eurozone leaders back to the drawing board once again, it’s the IMF, which essentially pulled the plug on the first €110bn Greek bailout early last year when it became clear it wasn’t working.
Signs that the IMF is on a bit of a hair trigger litter the new report. Read more
European regulators embarked on a financial rulemaking binge after the 2008 crisis. Yet the biggest question of all — how do you let a big bank like Lehman Brothers collapse without endangering the entire financial system — remains unanswered. If you think the system was inadequate 2008, it is basically no better today.
A Brussels proposal on “Crisis Management and Bank Resolution” has been promised “in a few weeks” since the summer of 2011. Month after month, the Commission ducked the issue. Today Michel Barnier, the commissioner overseeing financial services, admitted he needed more time for a informal mini-consultation on “timing and calibration”. The odds are surely lengthening on a proposal emerging before the summer. Read more