Suchergebnisse

Harmonised data from the 2013 to 2018 Stability and Convergence Programmes (SCPs) are used to assess whether member states are acting to meet EU fiscal requirements and, in particular, their medium-term objectives (MTOs). EU AMECO data are employed to check whether planned fiscal policy, set out in the SCPs, materialises ex-post. The main finding is that planned changes in the fiscal stance aim towards meeting the MTO when that target has not yet been attained but less effort occurs in practice. Member states who have already met their MTO loosen their fiscal stance. The policy message is that, in general, the enhanced, post-crisis EU fiscal framework is delivering budgetary policy that contributes to avoiding excessive deficit and debt positions. The fiscal consolidation actually undertaken, however, is less than planned and the upside of the economic cycle does not see greater effort towards meeting MTOs. Moreover, those member states with prior excessive deficits do not make, nor plan, any additional fiscal effort over other member states also striving to meet their MTO. The policy reaction to the economic cycle is pro-cyclical in nature.

AbstractBanking reform proposals put forward in the wake of the recent financial crisis maintain that equity‐based banking would be stable and would prevent bank runs. This article argues that complementing this form of banking with an indirect convertibility monetary standard and thereby dispensing with base money would enhance financial stability further. Banks would not hold a distinctive asset (base money) that would be called upon by customers at short notice, thereby removing the possibility of bank runs. No discrepancy in value between the two sides of a bank's balance sheet would arise as its assets (securitised loans) would be marked to market. Unlike other recent contributions, the intermediation model outlined here is not 'limited purpose' in nature as banks would not be restricted in the form of lending activity they can pursue. Common sources of banking and financial instability – liquidity risk, solvency risk, moral hazard – would be absent.

Applying a t-DCC-GARCH model to daily spread data, four phases of interaction in euro area sovereign bond markets are identified between January 2008 and June 2013. The initial period (January-October 2008) is followed by a general rise in pairwise correlation values between November 2008 and late 2009/early 2010. Interaction then declines on a piecemeal basis up to early 2012. In autumn 2012, coinciding with the announcement of the Outright Monetary Transactions programme by the European Central Bank, there is evidence of some reengagement of bond markets with one another. Policy then seems to have had an influence on euro area sovereign bond market behaviour. While it can act to calm markets, policy may also be unduly influencing market dynamics and raising moral hazard issues.