Franco Pavoncello interviewed by Christopher Alessi
Eurozone leaders meeting for tomorrow's summit are unnecessarily worried about contagion to Italy, but a growing sovereign debt crisis highlights the role of politics in the markets and the need to find common, EU-wide solutions, says expert Franco Pavoncello.
Greece will undoubtedly receive a second bailout from the EU and IMF. But expert Daniel Gros says it remains to be seen whether default is inevitable and if banks and other private bondholders will also take a hit.
Saving the European Union requires a plan to allow fiscally weak member countries to fail, as well as painful lifestyle changes and some loss of national sovereignty, says the Centre for European Policy Studies' Daniel Gros.
Markets' reaction to the sovereign debt crisis in Greece and other European countries suggests global governments "have used up all their ammunition to boost global growth," and could be punished by the markets if they sustain stimulus programs, says CFR's Sebastian Mallaby.
Standard Chartered CEO Peter Sands says Western and Asian economies are both at risk of asset bubbles and that higher savings and social safety nets in Asia are not a near-term fix to global financial problems.
Gillian Tett of the Financial Times assesses the new U.S. plan for regulating derivatives markets and says regulators must balance the need to create transparency against the risk of stifling financial innovation.
CFR's Sebastian Mallaby says the G-20 summit could mark the beginnings of a profound shift in global financial regulation. But he says challenges lurk in the way the IMF is funded and how it monitors economic governance.
CFR economic expert Sebastian Mallaby credits President Obama with highlighting the long-term structural reforms needed to repair the U.S. economy and competitiveness, but says the scope of reforms may be too ambitious.
The Council on Foreign Relations' David Rockefeller Studies Program—CFR's "think tank"—is home to more than seventy full-time, adjunct, and visiting scholars and practitioners (called "fellows"). Their expertise covers the world's major regions as well as the critical issues shaping today's global agenda. Download the printable CFR Experts Guide.