Does Europe Need a Lender of Last Resort?

In: Business and Management

Submitted By nauna
Words 1531
Pages 7
Does Europe need a lender of last resort?
German Chancellor Angela Merkel and French President Nicolas Sarkozy appear to hope their recent Summit will avoid further increasing Euro rescue fund, the European Financial Stability Facility (EFSF), or issuing joint Eurobonds.
Both measures are extremely unpopular in Germany, which sees itself as the financier of spendthrift southern Euro zone member countries.
Germans are only willing to pay with “their” money in “return” for strict austerity measures. And, as Merkel has said, Eurobonds would only be considered as last means.
The German Chancellor seems to believe that the Euro zone is not yet at the point where last resort measures need to be considered seriously.
Unfortunately, Mrs Merkel may be wrong.
Are we there yet?
There are a number of compelling reasons to back this. With Italy and Spain (and eventually France and Belgium) in peril, even a tripling or a quadrupling of the ESFS fund would not be sufficient.
And by providing such funds the debt crisis would surely arrive in Germany, too.
So far, imposed austerity measures have induced recessions in the debtor countries, Euro zone economic growth is flat and even in Germany zero growth was reported in the last quarter. All this makes it more difficult to grow out of the debts.
Financial markets and especially interbank markets are increasingly showing signs of resembling the conditions preceding the global financial crisis conditions – strongly suggesting that another banking crisis is just around the corner.
But this time it will hit the Euro zone countries when their public debt levels are much higher. This will leave much less room for rescuing operations.
Not the sole culprit
Germany sees excessive sovereign debts in some countries as the root of the problem. If this problem is addressed properly and solved then the crises should disappear.
But a…...

Similar Documents

Southwest Airlines Does Luv Last

...Does “LUV” really last? Many relationship experts have stated that “LUV” is eternal and that it is like a muscle that must always be worked out to keep it in shape, in order for it to last forever. While some may disagree that “LUV” can’t last forever, when it comes to relationships, the “LUV” that is in question is Southwest Airlines. What once was a small commuter air service, has now grown to be one of the largest and most successful major airline companies in the United States. So how did Southwest Airlines become so successful? It all began with the founders Rollin King, an entrepreneur, and Herb Kelleher, an attorney, who demonstrated strategic leadership from the beginning. The strategic leadership began when the these two gentlemen saw an opportunity that would be beneficial due to the inconvenience and expense of ground travel by either bus, train, or automobile between three major cities, which were Houston, Dallas, and San Antonio. Due to this, the establishment of Southwest Airlines came into existence by providing point-to-point short haul flights to less popular and less congested airports. Shortly after its establishment, like any other new businesses, Southwest faced many barriers in the beginning phases, which pertained to safety issues, inspections, and flight operations, which Southwest was able to overcome due to Herb Kelleher’s legal experience. After overcoming the barriers, the strategic leadership continued with the incessant building of the......

Words: 3714 - Pages: 15

Innovation as a Last Resort

...t ho ug OPINION Innovation as a Last Resort Going after breakthrough innovations may be glamorous, but mounting evidence suggests that's the last growth strategy you should try. by Michael Treacy Like swinging for the grand slam in baseball or betting on thetrifecta in horse racing,going for broke with innovation is glamorous. Breakthrough innovations, whether the next blockbuster product or a next-generation business model, create a buzz in the boardroom while lesser forms of innovation go unnoticed. Yet a body of evidence in recentyears makes a strong case that breakthrough innovation should be the growth strategy of last resort. Consider the travails of Sun Microsystems. Since its start in 1982, the company has developed a number of blockbusters-high-end computer workstations; the Java operating system, which has driven much Internet software development; and the powerful Internet file servers that are home to many a corporate Web site. During the dot-com bubble. Sun acted as if the Internet revolved around it. But since then, the company has been unable to keep the flow of breakthrough products coming. Even worse, in viewing itself as the industry's biggest innovator, the company eschewed more incremental innovations that could have generated signif- icant growth, including application software and consulting, which rivals have used to lock in customers. Sales since 2001 have slid nearly 40%,and $5.1 billion in losses have piled up.The company has watched......

Words: 1148 - Pages: 5

Does a Business Need to Be Ethical to Be Successful?

...Primark, one of the UK’s most popular retailers of budget clothing, has also been rated the country’s least ethical retailer. With reference to Primark or any business you have studied, to what extent does a company’s ethical stance determine its long-term success? [40] The ethical environment - The moral beliefs and attitudes from both inside and outside a business that influence its behaviour. Due to the current economic environment, many businesses are being forced to fight for survival and they therefore lose focus on long-term success and instead focus on short-term success. However the larger companies, which are blessed with sufficient finances and stability, such as Marks and Spencer and John Lewis are focusing all their efforts into improving their reputation, brand, revenue and costs all in hope of securing long-term success. In order to improve their reputation and brand image they are more than ever before, adopting ethical business practices including ethical sourcing, marketing, pricing and treatment towards employees. However, despite this positive move in the right direction from some businesses, others are being forced to seek success through other, unethical means such as unlawful treatment towards employees, unethical means of advertising, pricing, selling, contracting, sourcing and overall failing to meets the current laws and legislations, causing them to gain bad publicity and tarnished reputations yet, in some cases such as Amazon and Primark, they......

Words: 2027 - Pages: 9

Does Apple Need a Great Man?

...Medina Pashayeva 8491520 GEL/Jan12/1 Does Apple need “a great man”? After the death of Steve Jobs, management experts are wondering whether Apple will survive without Steve Jobs or not? This issue is also considered in the “InsideApple: Can It Thrive Without Steve?” article, published on the Forbes’ webpage where commentaries on the book of Adam Lashinsky “InsideApple” are provided. This article describes the aspects of the book regarding successful implementation of the “radical management system” by Apples’ incomparable leadership guru Steve Jobs. The article states that the author of the book, Lashinsky, based on the theory of organizations development, predicts an early death of Apple explaining that the company has entered the “path to senescence and death”. In turn, the author of the article, Steve Denning, specifies that “Apple’s future, therefore, depends on understanding the management principles Steve Jobs used to make it successful, while also recognizing his shortcomings. Those principles are eminently replicable business practices that, once understood, any firm can implement. It does not require “a great man”. Is it real that “any firm can implement” and does not require “a great man”? Does not Apple need Steve Jobs? When the “great guru” was fired in 1985, the situation in the company was not good enough; however, everything has changed since his return in 1997 and implementation of the strategy, which is still quite successful. Thus, CNBC reports that......

Words: 978 - Pages: 4

Where Does the "Need to Know" End?

...reasons that does not affect the way in which he governs his office proved as a society we focus our attention on issues that doesn't contribute to progress. Now, what has come in mind is perhaps an idea that is not clear to most but when we say “personal lives of politicians” to what degree of personal are we most concern with. If we're goring to debate this issue we must be clear as to where we stand, especially if we must limit broadcasting our politicians private lives. Not too long ago, former president Bush senior's wife, Barbara Bush underwent an open heart surgery. An extremely risky procedure and considering her age, it was unlikely to have predicted a good outcome. The former president shared some tears over this, something that should not have been broadcast. This moment was a family matter and should have remained so, but somehow the media felt as though it was necessary to broadcast it. It is true that Barbara Bush is an important figure in American history but that doesn't permit us to broadcast Bush senior's personal moment. As a society, we would have been just as satisfied had we known she was okay without the media broadcasting the personal tears from a past presidential leader. It is obvious to us all that the media will broadcast what ever issue they feel that would increase their rating. Well then, since the media has absolute power to broadcast whatever they wish is appropriate, why then are we debating this issue? The question should be does the......

Words: 892 - Pages: 4

Gun Control. Does It Need Revised?

...Gun Control. Does it need revised? Denise Kirby March 20, 2013 Gun Control. Does it need revised? Gun control seems to be a major issue for discussion in our society today. These issues have stemmed from all the violence and tragedies that have happened in the past several years. There seems to be two sides of this argument. People are either for stricter gun control laws or against it. I would like to try to find the correct answer as I am a gun owner. I enjoy target shooting, skeet shooting, and hunting. So, gun control. Does it need to be revised? The Second Amendment to the United States Constitution states “A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed.” There have been many debates as to what the original authors intended by the wording of this Amendment. Some people believe the phrase “the right of the people to keep and bear Arms” created individual constitutional rights for United States citizens. Some scholars argue that the phrase “a well regulated Militia” shows they meant only to restrict congress from taking away a states right to self-defense. In 1939 the United States Supreme Court adopted a collective rights approach in the case of United States v. Miller. They determined Congress could regulate a sawed-off shotgun which moved in interstate commerce under the National Firearms Act of 1934 because the evidence did not suggest it “has some reasonable...

Words: 1682 - Pages: 7

How Much Land Does a Man Need

...Analysis of How Much Land Does a Man Need by Leo Tolstoy Anna Gregor, Yahoo! Contributor Network Dec 23, 2009 "Share your voice on Yahoo! websites. Start Here." * More: * Tolstoy * Leo Tolstoy * * tweet * Print FlagPost a comment AdChoices | | In the short story "How Much Land Does A Man Need" by Leo Tolstoy, Pahom is a peasant living on a small plot of land. When his wife brags that a peasant's life is safer than having money, because with money comes temptation, Pahom agrees, adding that he would not be "afraid of the devil himself" if he only had more land. He buys more land, but is unhappy, for no matter how much more land he gets, he wants more. He becomes greedier and greedier until he loses control of his life and, in the end, loses everything. This story shows us that even if we have enough to get by, the prospect of becoming wealthier is so alluring it can cause us to risk all the good things we already have. At the start, Pahom is a content, hardworking men. Unfortunately, he makes the mistake of thinking that more land would make his life better. Pahom says to himself "our only trouble is that we haven't land enough. If I had plenty of land, I shouldn't fear the devil himself"! When an opportunity arises for Pahom to acquire more land, he jumps at the chance, convinced that more would make him happy. He paid off his debts and had plenty of fertile land to grow his crops and raise his cattle, but he was only satisfied for a short...

Words: 764 - Pages: 4

Does Apple Need to Spend 150 Billion?

...billion in cash at the end of last quarter. Carl Icahn owns a nearly $2 billion stake in Apple that he wants the company to issue a $150 billion buyback of its stock, believe the company to be extremely undervalued, Icahn, who considers Cook a good CEO, projects Apple’s stock can rise to more than $625 if it buys back shares. The catalyst would be a significant reduction in the share count, boosting EPS. Assuming moderate earnings growth, Icahn thinks the stock could return to its all-time high near $700. Icahn also wants Apple to borrow $150 billion at a 3 percent interest rate to fund the purchases and avoid paying more taxes, the person added. As Apple’s stock has slumped more than 20 percent in the past year on investor concerns about a dearth of new hit products, the iPad maker has become more vulnerable to calls for change from activists such as Icahn and hedge-fund manager David Einhorn. Apple is already implementing a substantial capital return program -- which includes approximately $60 billion in share repurchases between 2013 and 2015 -- but Icahn wants an even bigger and faster buyback. Their main argument is that if Apple significantly increases its stock buyback that will crowd out investment in research and development and other initiatives to boost innovation. This would in turn cause Apple to fall behind competitors, leading to a collapse in profitability. Does corporate raider Carl Icahns ideas pose a threat to Apple or does Apple has plenty of......

Words: 287 - Pages: 2

Does the Eu Needs a Constitution?

...History of the Treaty of Constitution for Europe – TCE: The establishment of a Treaty of Constitution for Europe (TCE) was a treaty attempting to create a solid constitution for the European Union that was unratified. The ideia was replace the current European Union treaties with a Constitution text, with legal force to the Charter of Fundamental Rights and expand Qualified Majority Voting into policy areas. The Treaty was actually signed on October 2004 by representatives of 25 member states and was later ratified by 18 member states. Spain and Luxembourg made referendums that approved the measure. As a consequence of the rejection of the project by France and Netherlands referendums the ratification process was ended. The Lisbon Treaty, that entered into force on 2009, replaced the Constitutional Treaty after some period. A lot of changes that were in the Constitutional text were add in the existing treaties as amendments. Inicial steps: The new debates on the future of Europe bagan at the Laeken European Council 2001, when former French President proposed to draft a Constitution. A European Convention was founded, chaired by the same former French President Valéry Giscard d'Estaing and composed of two Members of Parliament (generally one from the governing majority and one from the opposition) of each Member State, 16 MEPs, 2 members of the European Commission and a representative from each government. Then, the President of the European Commission......

Words: 2046 - Pages: 9

California Does Not Need Capital Punishment

...California Does Not Need Capital Punishment Capital punishment is the legally authorized killing of a person who has committed a heinous crime. Capital punishment has been around for centuries and is still used today in various countries including the United States. All though throughout the years capital punishment has lost its appeal and is gradually being ruled unconstitutional in the United States, the earliest being Michigan in 1846. Some of the 18 states that have already abolished capital punishment are New York, New Mexico, Alaska, Hawaii, and Iowa. Sadly, California is not apart of the list of states that have abolished capital punishment. Capital punishment should be abolished in the state of California because too many innocent people have been executed, it cost too much money, it does not act as a deterrent to crimes, and life without parole is a more practical option than capital punishment. There are too many flaws in the capital punishment system and many of them lead to innocent people being executed. According to John W. Whitehead in his article “The Death Penalty Should be Abolished”, “In a Columbia University study on 5,760 capital cases, the report found an overall rate of error of 68 percent. In other words, courts found serious reversible errors in nearly 7 out of 10 capital cases.”(1). If one innocent person was executed that would be one to many, but the fact that there is an error rate of 68 percent is unacceptable. The most infuriating thing......

Words: 1805 - Pages: 8

What Extent Does Advertising Create Needs in Consumers?

...television, etc. Attracting consumers to an array of items or services ranging from personal to professional needs in order to get “buy in” from the consumer. Pre-existing desires are often the prime motivator of why a consumer will give an advertisement their attention. The point is does advertising create a need for a product, or is it fulfilling an existing need already there hidden inside and stimulated once a product of interest is advertised, or a combination of both. It may be more of an underline need to satisfy a pre-existing desire that propelled a consumer to acquire a product, not the advertising creating a need. Advertisement, to what extend does advertisement create needs in consumers is an ongoing argument among society. “Advertising: It fosters materialism, it psychologically manipulates people to buy things they don’t need” (Laurence & Leonard 2011). There may be manipulation at hand that has little or no affect, but not a creation of a need for things they don’t need with advertising. There has been many studies of AMI (Advertising message involvement), which has been identified as an important individual or situational factor influencing the advertising processing. (Laczniak & Muehling 1993). This statement a lone said that advertisement is based on research of an individual needs or situations, which drives advertising not advertising driving needs. “In a marketing context, Perdue and Summers (1986) have discussed several issues......

Words: 1252 - Pages: 6

Does the South East Need More Airport Expansion

...------------------------------------------------- Does the South-East need more airport capacity? What are the arguments in favour of expansion? Heathrow currently runs at close to 100% capacity with demand for air travel predicted to double in the next 25yrs. With this increase in demand, Heathrow arguably will not be able to cope without a third runway. Heathrow needs extra capacity if it is to reach the levels of service found at competitors elsewhere in Europe in countries such as Germany in the Frankfurt Airport, or it will be overtaken by its rivals. The third runway will boost the economy by a predicted £7bn a year to the economy, according to airport owner BAA. Some say a third runway is the only solution to the congestion at Heathrow. Tens of thousands of jobs will be created in construction of the runway in the short term: and for business and in tourism over the longer term. Lack of expansion at Heathrow would threaten London's position as trading capital of the world, stifling the international links Britain was built on. Business leaders such as Barclays Bank argue London deserves and needs an airport of international quality. The airport said it would be able to cater for 130 million passengers compared to 70 million today, "allowing the UK to compete with our international rivals and providing capacity for the foreseeable future". Those pushing for the new runway argue that pollution caused by the airport will be closely monitored and kept to low. By 2020,......

Words: 654 - Pages: 3

Why Does Anyone Need an Mba?

...deaths; vendors offering radiation-contaminated tea for half-price; a little girl's death resulting from her fall through an open sewage manhole in her schoolyard; radioactive waste sold to unsuspecting scrap dealers; a twenty-year-old tanker breaking into pieces, spilling hundreds of tons of crude oil into the ocean and killing sea life all around. The frequency with which these environmental disasters fill Turkish news broadcasts -- along with the obvious insensitivity of the authorities towards both environment and health issues -- prompted me to learn about ways to prevent these types of disasters. At the age of fifteen, I decided to focus my studies on environmental sciences in order to equip myself with the technical tools I would need to make a real contribution. After earning a master's degree in environmental sciences, I completed a professional international management certificate program in order to gain a management perspective of the field. I then realized that, in order to effectively combine my technical knowledge and management skills, I needed to accumulate real-world experience. Specifically, working at a large company would allow me to develop insight into various industries, as well as an overarching vision of the international business arena. I have now worked for nearly two years in the energy and environment group of Koc Holding, Turkey's first and biggest diversified conglomerate. As a project engineer, I am mainly responsible for our holding......

Words: 862 - Pages: 4

Why Does Society Need Accountants

...One of the main questions regarding accounting in public discussion are the purpose of accounting principles and their use for society. So why do we need accounts and why does the society rely on accounting since medieval times? Frankly spoken society needs accountants since they are necessary for businesses to grow and flourish. Accountants help to solve adverse selection and moral hazard issues resulting from imperfect information within the company and with external parties which could result in a lower profitability of the business operations and a lower efficiency in the capital accumulation cycle. So one can argue that accounting is the backbone of the business financial world. The major functions of accounting and their use for society can be divided into two broad categories, which will be discussed in the following paragraphs. The first accounting category, which is often referred to as financial accounting, is comprised of information that companies intend to make available to the general public to attract new capital investments and to support the business operations. Stockholders, creditors, customers, suppliers, and regulatory authorities need detailed information while dealing with a company. The business provides them with the required relevant information via annual reports and financial statements to reduce the information asymmetries which could result in worse creditor and stockholder relations and which could prevent individuals to invest in the......

Words: 378 - Pages: 2

Sorghum Is a Last Resort Instead of Corn

...Finally looked the pork price rise, but the main raw material feed - rising corn prices gave farmers an added worry. In order to prevent being swallowed corn farming profits, some feed mills and large-scale farms try to use low-cost alternative to study sorghum as feed corn the main raw material, but instead of corn as well as sorghum nutrition and cost issues need to be resolved, it said the move was only a last resort to do this, but also expressed this method is the future trend. Corn as a feed in the main source of energy, the price continued to rise in recent years. For this argument sorghum instead of corn, sorghum can partially replace corn, and all alternative is not acceptable. Sorghum is a result of using corn prices last resort, you can adjust as changes in the market, but not a permanent solution. Sorghum instead of corn there are two main problems, the first is the tannin on Animal anti-nutritional factors, which can be solved by reducing the amount of detoxification methods; the second is less than the energy of sorghum corn energy, the production process to reduce other low-energy raw materials used, or add some fat. There are a number of companies to develop tannins enzymes for reducing tannin effect on the animal. But this approach is not realistic, because the cost is too high. Meanwhile, corn feed is irreplaceable. If in accordance with 50% in pig feed sorghum, can save the cost of 200 yuan / ton. As long as the price of sorghum than corn lower 100 yuan......

Words: 380 - Pages: 2

Download | Full Screen Caller ID v12.6.2 APK Cracked | [ Vietsub ] Sunflower - Post Malone, Swae Lee ( OST Spider Man Into Spider Verse )