Econintersect: Numerous reports Sunday all had the same basic message: EU (European Union) finance ministers got little accomplished in their two days of meetings that ended Saturday (September 17). According to The Wall Street Journal they did little more than spar over peripheral issues such as imposing a securities transactions tax, boosting the European bailout fund and various requests for collateral. In the meantime, the LA Times had a report that several central banks, including the U.S. Federal Reserve, are pumping billions of dollars into shaky European banks.From The Los Angeles Times:
The Federal Reserve and four other central banks moved to inject billions of U.S. dollars into Europe‘s troubled banking system, giving a dose of confidence to investors who have grown worried about the ripple effects of the Greek debt crisis.
Along with the Fed, the dollar action was undertaken by the European Central Bank, the Bank of England, the Bank of Japan and the Swiss National Bank.
The move was the latest in a series of steps that European leaders have taken in the last two months to aid the banks and overcome the continent’s debt crisis.
Concern about European banks was reflected by the statements of several leaders. From The Independent:
Michel Barnier, the EU’s commissioner for financial regulation, said that the 2011 bank stress tests were an improvement over last year’s, but “we must also acknowledge that the tests did not restore the credibility in banks’ strength in the way we would have hoped”. The Spanish Finance Minister, Elena Salgado, said ministers recognised the need for “more uniform and … more rigorous” tests.
Even U.S. Treasury Secretary Timothy Geithner, who made the unprecedented move of attending the finance ministers’ meeting, expressed concern about damaging European divisions and the need to remove “catastrophic risk” from the markets. (From The Independent.)