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than less europe. more integration. you mentioned that today. and i would ask you. you mentioned fiscal union. what do you mean exactly when you say "fiscal union"? isn't it what a lot of germans mean when they say a transfer union? and are you going to be able to convince your own citizens to accept a transfer union? >> translator: the fiscal union is not a transfer union. what we mean when we talk about the beginning of a fiscal union is what we have already decided. that is to say, the stability and growth, a pact of which is now going to be binding. so we talked a lot about reducing the debt. people want to put that in their constitution sometimes. but for the first time, the european commission has the right to come and check whether the member states have really translated the stability pact in their legislation. and if they have not done it, the european court of justice can sue them. it's a paradox, if you want. we have a stability and growth pact, which is like european legislation, if you wan
than less europe. more integration. you mentioned that today. and i would ask you. you mentioned fiscal union. what do you mean exactly when you say "fiscal union"? isn't it what a lot of germans mean when they say a transfer union? and are you going to be able to convince your own citizens to accept a transfer union? >> translator: the fiscal union is not a transfer union. what we mean when we talk about the beginning of a fiscal union is what we have already decided. that is...
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the economic future of italy and europe. as fred mentioned, yes, i delivered a few words in 2006 on the topic does europe have an economic future? and after all, europe did have an economic future. but i think that many of the questions surrounding europe then are still there today. and, of course, i feel the responsibility in my temporary and luckily enough sharply timed to give a contribution to the solution of those problems. everybody has in mind, of course, theure j ureuro zone cr. i think everybody should be aware and i think everybody in this room is aware but not everybody in this country or in italy or in europe is aware of the fact that this has not been a crisis of the euro. the euro has continued to display very, very remarkable stability, solidity. it has not incurred on any of the two situations in which a currency shows its weakness in terms of the domestic purchasing power and in terms of external -- in term of exchange rates. so i think it is a really remarkable that although there has been and partly there
the economic future of italy and europe. as fred mentioned, yes, i delivered a few words in 2006 on the topic does europe have an economic future? and after all, europe did have an economic future. but i think that many of the questions surrounding europe then are still there today. and, of course, i feel the responsibility in my temporary and luckily enough sharply timed to give a contribution to the solution of those problems. everybody has in mind, of course, theure j ureuro zone cr. i think...
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this means that what we have already achieved in europe can only be preserved if we renew europe with strength. and, therefore, we can say that this crisis is a chance for us, it's the chance for us to create a stability union, a stable union, worthy of the name. the question of finances very often it is summarized in cut, cut, cut. well, that's too simple. no, it has to to with the fact that we have to live in a sustainable way and we have to also think about the next generation. and if we were not able to have a sustainable system, well, we would be in a very difficult situation that we could never overcome in the future. and the financial markets doubt, they wonder if we can come out of this crisis, and, therefore, one of the elements is to consolidate our budgets. we could say that we have started. we have started the beginning, if you want. the pacts of the treaties are clear. we had the stability, it was very clear rules. the problem and the truth is that the rules were never respected. nobody checked them. and, therefore, the reality was different from what was on paper. so we
this means that what we have already achieved in europe can only be preserved if we renew europe with strength. and, therefore, we can say that this crisis is a chance for us, it's the chance for us to create a stability union, a stable union, worthy of the name. the question of finances very often it is summarized in cut, cut, cut. well, that's too simple. no, it has to to with the fact that we have to live in a sustainable way and we have to also think about the next generation. and if we...
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Feb 10, 2012
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the issue then becomes -- what is the next level of europe? germany has a clear view of what the future of europe is going to be and they've found two tools that will force union fiscal discipline after two years of reasoning, threatening and pleading had no effect on their fellow members. first they see that market forces prevail where diplomacy failed. if you keep painfully high interest rates on the politicians that will compel them to make difficult choices that need to be made. the second step they've done is removed the unanimity requirements before all the eurozone decisions. before they could stop the euro without a veto and therefore, they set up a system where there will be no access to emergency funding unless a member agrees to the fiscal conduct. and what will happen is the fear of being left behind is going to support -- left behind without support is going to force submission to this fiscal reform. and so what you'll see over the next two to three years is germany will drive the eurozone towards a fiscal union with central contr
the issue then becomes -- what is the next level of europe? germany has a clear view of what the future of europe is going to be and they've found two tools that will force union fiscal discipline after two years of reasoning, threatening and pleading had no effect on their fellow members. first they see that market forces prevail where diplomacy failed. if you keep painfully high interest rates on the politicians that will compel them to make difficult choices that need to be made. the second...
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Feb 3, 2012
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one reason is the ghastly history of europe. remember why they created the european union in the first place, to overcome the previous millennium of slaughter in europe, most dramatically, the first half of the last century. i happened to visit the holocaust museum again. if you've done that recently it gives you plenty of memory of why the europeans have pulled together to avoid letting europe, again, explode into kind of holocaust and disaster that they experienced. so they're going to hold europe together. in addition to that, they have an overwhelming economic interest. germany, which is the pivotal country, has a nirvana economic situation in europe, in the euro. germany is the largest surplus trading country and it bases it's whole economy on an export-led growth model. in the old days, when they had their own deutsche mark, it was rise and they would choke off competitors and fight. now, the germans have the world's largest trade surplus and a weak currency which, for them, is the perfect outcome and every german knows it
one reason is the ghastly history of europe. remember why they created the european union in the first place, to overcome the previous millennium of slaughter in europe, most dramatically, the first half of the last century. i happened to visit the holocaust museum again. if you've done that recently it gives you plenty of memory of why the europeans have pulled together to avoid letting europe, again, explode into kind of holocaust and disaster that they experienced. so they're going to hold...
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Feb 27, 2012
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and for europe we focus on iran. iran has a fairly active missile program, largely consisting of liquid propellant missiles. they are doing interesting experiments on solid propel ants. today they have scud and old soviet missile. shahad 3. liquid missile, technology probably received from north korea. this is north korea nodong missile. they have recently test add solid missile with a range of 200 to 20,000 kilometers, somewhere in that range. some people are suggesting we may see a liquid propellant missile in the range of 3,000 kilometers in the not too distant future. so today the threat is really quite -- the missile threat from iran is localized to the middle east. obviously israel is very concerned about it because they are within range. turkey could be concerned about it but turkey is a friend of iran, which is one reason they resisted nato attempts until very recently and agreed to deploy a radar which you'll see on future maps right about here in turkey. in the next, say, several years, five years, missile
and for europe we focus on iran. iran has a fairly active missile program, largely consisting of liquid propellant missiles. they are doing interesting experiments on solid propel ants. today they have scud and old soviet missile. shahad 3. liquid missile, technology probably received from north korea. this is north korea nodong missile. they have recently test add solid missile with a range of 200 to 20,000 kilometers, somewhere in that range. some people are suggesting we may see a liquid...
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people don't understand in europe, especially young people in europe and people who are not members of the elite. >> who? >> the people who are not part of the elite, the average citizens. my question is the following. don't you think that we should have a much stronger social dimension in the european union? that is to say we could have european unemployment insurance. that would be a new narrative that would be much more understood by the population of europe. >> well, you know, today and in the future even less, we can no longer base ourselves only on the roots of europe and mention the foundation, because we are in a totally different situation. that's why today i insisted on the fact that for me, the justification of europe, besides the historical justification, remains true that if we want to maintain our living standards and our way of life, our way of life in europe, we have to be more competitive. and because we are together, we are worth more together than individually. and of course we have to defend our interests. especially freedom. so europe must defend itself and be itse
people don't understand in europe, especially young people in europe and people who are not members of the elite. >> who? >> the people who are not part of the elite, the average citizens. my question is the following. don't you think that we should have a much stronger social dimension in the european union? that is to say we could have european unemployment insurance. that would be a new narrative that would be much more understood by the population of europe. >> well, you...
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Feb 2, 2012
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if europe implodes, the risk to our economy is serious. we need to remember that almost one quarter of u.s. exports go to our european trading partners so what happens to the european economy could have a very real impact on u.s. manufacturers and u.s. workers. with that, we'll turn to senator johnson who is filling in for senator sessions this morning for his opening remarks and then we'll turn to our witnesses for their testimony and, again, i want to thank senator johnson for filling in for senator sessions this morning. i just say to colleagues, there are many competing meetings of other committees this morning, including mark-ups in some, which means that colleagues who would like to be here simply cannot be here and participate in the work of other committees on which they serve so, we understand that this is a meeting in which there are many competing priorities for members of this committee. senator johnson. >> thank you and only i'm here because this is my top priority and i think this is certainly the greatest threat that faces o
if europe implodes, the risk to our economy is serious. we need to remember that almost one quarter of u.s. exports go to our european trading partners so what happens to the european economy could have a very real impact on u.s. manufacturers and u.s. workers. with that, we'll turn to senator johnson who is filling in for senator sessions this morning for his opening remarks and then we'll turn to our witnesses for their testimony and, again, i want to thank senator johnson for filling in for...
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Feb 3, 2012
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so they're going to hold europe together. in addition to that, they have an overwhelming economic interest. germany, which is the pivotal country, has a nirvana economic situation in europe, in the eurogesturplus trading country and it bases it's whole economy on an export-led growth model. in the old days, when they had their own deutsche mark, it was rise and they would choke off competitors and fight. now, the germans have the world's largest trade surplus and a weak currency which, for them, is the perfect outcome and every german knows it and they'll continue it and virtually at any price would be worth paying for them to keep that situation together. if you went to a new deutschemark it would explode up in value and the whole german economic progress, which has been so impressive in these last few years, would collapse. so the bottom line is both germany and europe as a whole has a huge, huge interest in holding the eurozone together. so my conclusion, and it's, i think, supported by the evolution of the current crisis
so they're going to hold europe together. in addition to that, they have an overwhelming economic interest. germany, which is the pivotal country, has a nirvana economic situation in europe, in the eurogesturplus trading country and it bases it's whole economy on an export-led growth model. in the old days, when they had their own deutsche mark, it was rise and they would choke off competitors and fight. now, the germans have the world's largest trade surplus and a weak currency which, for...
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but when you look at the press in europe, everybody in europe talks about this crisis in a different perspective. and we need a europe with the mobility of workers. it also means that we need transfer possibilities so that everybody can have portable pensions, for instance. if you work in five different countries, you need to be able to take your pension with you. and also we have to harmonize the retirement age. in some countries it's 55. in germany it's 67. we have a lot to do. that is to say the social dimension is one of the aspects. but it's far from being the only one. but what we have to create is of course as students you are more together than our workers, for instance. but we need more of a european public. we have to know that we all belong to the same area, for instance. >> translator: thank you. now i have a question about the relations between germany and the others. what about the image of germany abroad? from france is going to ask the question. >> translator: no, you can speak without microphone. i can hear you well. you have a good voice. >> translator: many in euro
but when you look at the press in europe, everybody in europe talks about this crisis in a different perspective. and we need a europe with the mobility of workers. it also means that we need transfer possibilities so that everybody can have portable pensions, for instance. if you work in five different countries, you need to be able to take your pension with you. and also we have to harmonize the retirement age. in some countries it's 55. in germany it's 67. we have a lot to do. that is to say...
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Feb 27, 2012
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europe is so focused on the euro zone. as you've seen in the past couple of days, we've tried to organize support for the southeast asia. we got information yesterday that verified what i've been worried about, which is you're going to see a credit retraction as the banks pull back. the events in the euro zone and union are going to have an ability to overcome the economic issues related to the political problems. we're seeing it in trade finance. again, i think there's a little bit of my open pea yeah and some of this goes back to how you implement the banking regulations. the european standards did not take account for these risks. i think it's now adjusting. they have ripple effects of this. they affect young people and old people in situations that we should be concerned about. >> mark carney, one of the issues was raised here, if central bankers take losses when an actor loses in a full hearty manner. and secondly, is the regulatory system what you're actually providing completely confused message closing doors and ma
europe is so focused on the euro zone. as you've seen in the past couple of days, we've tried to organize support for the southeast asia. we got information yesterday that verified what i've been worried about, which is you're going to see a credit retraction as the banks pull back. the events in the euro zone and union are going to have an ability to overcome the economic issues related to the political problems. we're seeing it in trade finance. again, i think there's a little bit of my open...
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this has largely to be achieved within europe. for example, i think we came to a deep common understanding with germany that anything which would improve the perceptions by the markets that the eurozone is well governed, in terms of readiness to put up adequate fire walls will actually imply a very small probability that such financial resources would have to be used because they will be credible enough for the mere fact that they are there. with the u.s., i think this would be the topic of my conversations. i don't know. i hope i'll not be late to the white house. >> we'll get you there on time. >> how, given the fact that the u.s. is struggling to have budgetary consolidation, as we would call it, and these are reentered towards growth. we are doing exactly the same in a different context how we can develop synergies in order to do this more easily. as to the imf, there is a prominent figure of the imf in this room. i would say that the imf is playing a key and constructive role. i think the imf is right when it says concerning
this has largely to be achieved within europe. for example, i think we came to a deep common understanding with germany that anything which would improve the perceptions by the markets that the eurozone is well governed, in terms of readiness to put up adequate fire walls will actually imply a very small probability that such financial resources would have to be used because they will be credible enough for the mere fact that they are there. with the u.s., i think this would be the topic of my...
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Feb 29, 2012
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europe obviously is the major -- even more major than oil prices is what happens in europe. are you satisfied that they're taking steps in the right direction to try to satisfy their problems and have we done as much as we can reasonably do to help with that? >> well, they've taken some positive steps recently, as i mentioned in my testimony. the ecb had its second long-term refinancing operation today, three-year lending to the banks. they're still working on getting the greek deal done. a number of the countries in fiscal trouble have been taking strong steps to improve their budget balances. there has been progress on a fiscal compact whereby there will be more coordination among countries. but there's still a lot to be done. in the short term there still needs to be more effort on providing so-called firewalls, financial backstop,s in case there is a default or potential contagi contagion. in the long run, the real problem or a very serious problem that has not been solved is that many of these countries are not only fiscally challenged but not competitive. large current
europe obviously is the major -- even more major than oil prices is what happens in europe. are you satisfied that they're taking steps in the right direction to try to satisfy their problems and have we done as much as we can reasonably do to help with that? >> well, they've taken some positive steps recently, as i mentioned in my testimony. the ecb had its second long-term refinancing operation today, three-year lending to the banks. they're still working on getting the greek deal done....
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as europe works its way through
as europe works its way through
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to be clear, what is happening in europe to be clear, what is happening in europe has ramifications across the globe, certainly including the united states. here's the front page story in the washington post last week. imf fears european crisis poses risk of major recession. the article highlights the international monetary fund's concern that the turmoil in europe could have serious consequences for the global economy. yesterday, we saw reports that european leaders had agreed to new measures to dads the debt concerns in their -- to address the debt concerns in their countries. "the new york times" headline on the agreement. european leaders agree to they measures to enforce discipline. i'd very much like to hear the views of our witnesses on this agreement, and whether it's the right answer for europe at this moment. most economists believe the eurozone is already in recession. we can see the blue chip forecast shows eurozone economic growth falling from anemic 1.6% in 2011 to a negative .004 in 2012. at the same time, european nations are saddled with large and growing debts that impact
to be clear, what is happening in europe to be clear, what is happening in europe has ramifications across the globe, certainly including the united states. here's the front page story in the washington post last week. imf fears european crisis poses risk of major recession. the article highlights the international monetary fund's concern that the turmoil in europe could have serious consequences for the global economy. yesterday, we saw reports that european leaders had agreed to new measures...
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i was fascinated by your assessment of europe. the thought kept going through my mind is past performance doesn't guarantee future results. i hope you're right. i'm assuming dr. lerrick and dr. johnson probably aren't in agreement with a rosie scenario. >> i think i'm actually more optimistic than dr. bergsten. i believe it will drive europe to a stable financial union. we have many more summits to go but they'll get there. i believe. but there is a large risk. one of my colleagues uses an analogy. he said this is a dangerous operation. you could have the most skilled surgeon in the world but things can go wrong. and so something could go wrong. i believe that the europeans will manage this process. i think the germans have now found the tools do that, which are just to keep interest rates really high on all the politicians that are of the weak countries and that will force them to do what german threats and pleading and reasoning did not succeed in doing for two years. and secondly the new strategy, which is if you agree, that's
i was fascinated by your assessment of europe. the thought kept going through my mind is past performance doesn't guarantee future results. i hope you're right. i'm assuming dr. lerrick and dr. johnson probably aren't in agreement with a rosie scenario. >> i think i'm actually more optimistic than dr. bergsten. i believe it will drive europe to a stable financial union. we have many more summits to go but they'll get there. i believe. but there is a large risk. one of my colleagues uses...
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Feb 2, 2012
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the great problem in europe is not the problem of deficit or debt. europe has a much more serious long-term problem. you can solve the debt easily. you write it off. you can the deficits easily, i'm saying economically, not politically, easily, you cut spending. the difficult problem is that southern europe's populations expect a lifestyle their productivity cannot supply. greeks don't have to be germans but they can expect to be -- but then they can't expect to be paid like dper mans. so you have a 25% gap between southern europe and german labor cos costs that are on the closed by deflation. this is a long, painful process that will precipitate a five to seven-year recession in the southern european countries and there you're talking about close to 40% of europe's gdp. the only other alternative is a long-term transfer from europe's north to south. re-unification of germany caused same problem of differing productivity. what the germans decided was they proposed a solidarity tax imposed on west germany to bring east germany up to west der man stand
the great problem in europe is not the problem of deficit or debt. europe has a much more serious long-term problem. you can solve the debt easily. you write it off. you can the deficits easily, i'm saying economically, not politically, easily, you cut spending. the difficult problem is that southern europe's populations expect a lifestyle their productivity cannot supply. greeks don't have to be germans but they can expect to be -- but then they can't expect to be paid like dper mans. so you...
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so europe has the model that is now in a world in complete change. and there's a question that we have to ask ourselves. in 1950, just coming out of world war ii and little by little brought germany back into the community of the world. and the other germany, it was not the same. back then we were on the planet with 2.5 billion people. 20% of the humans were europeans. last year we hit 7 billion people in the world. and today, the europeans are only 7% of the world population. even if we are still 20% of the world gpp, but when we see each other again 20 years from now you will see that the numbers will have changed even more. our societies are aging in europe. we are in the rapid demographic change. there are more and more retired people, less and less active people among europeans. what does that mean? it means that if we want to keep our living standards, we have to change our policies. if we want to keep our values in the globalized world, we have to work together and speak with one voice and we have to convince the others with one voice. so it h
so europe has the model that is now in a world in complete change. and there's a question that we have to ask ourselves. in 1950, just coming out of world war ii and little by little brought germany back into the community of the world. and the other germany, it was not the same. back then we were on the planet with 2.5 billion people. 20% of the humans were europeans. last year we hit 7 billion people in the world. and today, the europeans are only 7% of the world population. even if we are...
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Feb 26, 2012
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it would ratify the post cold war settlement in europe. given the stormy past of that region, inhabitants are said to produce more histories than they can consume locally. every should wish to see it settle economically and politically inside a stable european structure. why was this not done? why was every obstacle put in the way of the new market democracies? why were their exports subject to the kind of absurd quotas that have until now been reserved for japan? why is there still no room at the inn? the answer is that the european union was too busy contemplating its own naval. both the commission and the majority -- [ applause ] both the commission and the majority of member governments were committed to an early beating of the european union. that is, centralizing more power and the supernational institutions. they felt a widening of it, that is admitting new members would complicate, obstruct or prevent this process. while the deepening went ahead, they arranged to keep the central europeans out by the diplomats' favorite tactics, ne
it would ratify the post cold war settlement in europe. given the stormy past of that region, inhabitants are said to produce more histories than they can consume locally. every should wish to see it settle economically and politically inside a stable european structure. why was this not done? why was every obstacle put in the way of the new market democracies? why were their exports subject to the kind of absurd quotas that have until now been reserved for japan? why is there still no room at...
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swap market in europe. and i would urge you strongly in public or in private to bring the relevant regulators before you and discuss this, as a matter of time priority for the budget. because this is a huge fiscal risk that you're facing. can't give you a number and that's not because i don't follow this closely. i follow it very closely. those numbers are not tors have they should be sharing them with you. you should be asking very, very hard questions to them, what would it take to figure them out and perhaps you could ask the big banks to come in and testify about this. what is their exposure, what do they think of their exposure, how do they model it? we still give them enormous authority to handle management skeptical they know how to handle this at all. >> i suspect you're right, that that can't be quantified without bringing them in. anyone else care to comment on that? >> those numbers are not public certainly, as dr. johnson said, it's unlikely even our regulators know them for sure. i would say tw
swap market in europe. and i would urge you strongly in public or in private to bring the relevant regulators before you and discuss this, as a matter of time priority for the budget. because this is a huge fiscal risk that you're facing. can't give you a number and that's not because i don't follow this closely. i follow it very closely. those numbers are not tors have they should be sharing them with you. you should be asking very, very hard questions to them, what would it take to figure...
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the spread of democracy and civil society in eastern europe and the baltics. better prospects for solving regional conflicts like those in south africa and the middle east once soviet mischief making had been removed. the discrediting of social economic planning by the exposure of its disastrous consequence necessary russia and eastern europe, and the removal of soviet obstruction on the united nations and its agencies. these were, and still are, real benefits for which we should be grateful. in the euphoria, which accompanied the cold war's end, just what is church hill's private secretary called the hiatus of 1944 to 1946, we failed to notice other, less appealing consequences of the peace. like a giant refrigerator that had finally broken down after years of poor maintenance, the soviet empire in its collapse released all the ills of ethnic, social and political backwardness which it had frozen in suspended animation for so long. suddenly, border disputes between the successor states erupted into small wars in, for instance, armenia and georgia. within thes
the spread of democracy and civil society in eastern europe and the baltics. better prospects for solving regional conflicts like those in south africa and the middle east once soviet mischief making had been removed. the discrediting of social economic planning by the exposure of its disastrous consequence necessary russia and eastern europe, and the removal of soviet obstruction on the united nations and its agencies. these were, and still are, real benefits for which we should be grateful....
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Feb 7, 2012
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is europe in recession right now? >> well, certainly the southern countries, including the ones that are under fiscal pressure are contracting. it was growing at essentially a zero rate in the second half of last year. so certainly parts are in recession. whether the whole euro zone goes into recession remains to be seen. the ecb itself has predicted a mild recession and has warned that this might occur. so we think it's a possibility. but the severity and length remains uncertain. >> we have seen decline in exports to europe. exports to europe are about 2% of our gdp. so it's not totally make or break. >> give us an indication of what our economic growth will be and job creation. i would also have to calculate consumer house cold income. it's down the lowest since 1995. is that correct? to your recollection? >> as i mentioned, it was really close to flat over 2011 and because they've actually seen increased costs of goods through commodity prices, food, fuel, things like that they've seen slight increases from taxes
is europe in recession right now? >> well, certainly the southern countries, including the ones that are under fiscal pressure are contracting. it was growing at essentially a zero rate in the second half of last year. so certainly parts are in recession. whether the whole euro zone goes into recession remains to be seen. the ecb itself has predicted a mild recession and has warned that this might occur. so we think it's a possibility. but the severity and length remains uncertain....
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it's an interesting set of facts on the ground in europe. it looks like they have staunched the bleeding when it comes to broader europe. the european central bank came in with a massive program that has an analogy to the quantitative user program in the united states. taken some of the insolvency concer concerns. not that there aren't huge, massive, long-term problems in europe. if greece can get solved and needs to get solved with european money and there's sufficient amounts of it out there, of course, with a massive private sector haircut, which means they agree to reduce the amount of the value of the bonds they own and really take a hit on the value and that could help out the u.s. economy and helping out the european and global economy. bernanke was asked about this a lot today, and he believes europe is at or close to being in recession. he did say that u.s. banks have reduced their exposure to greece, but he did offer that, look, don't fool yourself. if there's a major financial shock in europe, it's going to be felt on these shores
it's an interesting set of facts on the ground in europe. it looks like they have staunched the bleeding when it comes to broader europe. the european central bank came in with a massive program that has an analogy to the quantitative user program in the united states. taken some of the insolvency concer concerns. not that there aren't huge, massive, long-term problems in europe. if greece can get solved and needs to get solved with european money and there's sufficient amounts of it out there,...
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Feb 14, 2012
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the crisis in europe so far has had a pretty substantial negative impact on growth here and around the world. european leaders, though, are making some progress. they've got a ways to go but they are starting to build more confidence around the world that they've got a plan in place that will at least avoid the prospects of financial catastrophe in europe, even though growth may be weaker and they still face years and years of difficult reforms, they seem more committed now to avoiding a catastrophe and implosion, blowup in europe that would have adverse impact in the united states. that's a very good thing for us because it means even if growth in europe is weaker than any of us would like, we're less likely to face the aftershocks of a sustained period of europe living on the edge of crisis. now, the derivatives markets are still a substantial source of risk even with all the benefits they bring to people's capacity to hedge risk. they come with significant risk but because we have forced u.s. financial institutions to hold much more capital against those risks, not just in derivativ
the crisis in europe so far has had a pretty substantial negative impact on growth here and around the world. european leaders, though, are making some progress. they've got a ways to go but they are starting to build more confidence around the world that they've got a plan in place that will at least avoid the prospects of financial catastrophe in europe, even though growth may be weaker and they still face years and years of difficult reforms, they seem more committed now to avoiding a...
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Feb 19, 2012
02/12
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not only to europe but to latin america. there's no question that fdr wanted the power and ability to aid the victims of aggression. he faced a powerful isolation sentiment into congress and the american congress and a very important isolationist organization known as the america first committee. >> foernl fly across the atlant atlantic. >> that made him? >> famous. >> yeah. he was the great american hero. he was famous. more people knew lindbergh. he became the public voice of the isolationist movement. his arguments were very, very racial. anybody know how lindbergh was making a racial involvement about america's involvement in world war ii? he made several of them. >> the danger is not germans. the danger is asia. >> exactly. this is a quarrel among the white civilized people of europe. it's really unfortunate that the white civilized people of europe should be fighting one another. we do not want to get involved in that and have more white civilized christian people slaughtered. what a horrible thing. that's really where
not only to europe but to latin america. there's no question that fdr wanted the power and ability to aid the victims of aggression. he faced a powerful isolation sentiment into congress and the american congress and a very important isolationist organization known as the america first committee. >> foernl fly across the atlant atlantic. >> that made him? >> famous. >> yeah. he was the great american hero. he was famous. more people knew lindbergh. he became the public...
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Feb 19, 2012
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basically uninvolved with these quarrels in europe. you know, critics at the time said these were acts perfectly designed to keep the united states out of world war i, but which this time most americans thought it was a mick take for the united states to get involved in world war i, and most americans wanted to keep america out of foreign crises. time and time again, starting in 1935 through 1938, against roosevelt's wishes, congress passed a series of neutrality acts, pretty much tying the hands of the president, making it very difficult for the president to respond to foreign crises because he couldn't make distinctions between aggressors and victims. and the congress had also rejected something else that roosevelt wanted, and that was american participation in the world court. we were not members of the league of nations, but we could still be members of the world court. roosevelt, who understood the dangers abroad and was not an isolationist, was an internationalist and wanted america more involved, gets rebuffed. congress won't ra
basically uninvolved with these quarrels in europe. you know, critics at the time said these were acts perfectly designed to keep the united states out of world war i, but which this time most americans thought it was a mick take for the united states to get involved in world war i, and most americans wanted to keep america out of foreign crises. time and time again, starting in 1935 through 1938, against roosevelt's wishes, congress passed a series of neutrality acts, pretty much tying the...
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Feb 3, 2012
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economy of worse outcome in europe. i think that is a topic we've discussed a number of times in our panel of economic we built into this projection shallow recession in europe, which is consistent i think with the latest consensus forecasts. we didn't find a way to quantify a particular alternative european scenario. and part of that is it's very -- we're very unsure what the financial connections are. and just how a particular sort of financial debacle in reverbe financial institutions. it's a very hard thing for us to know. >> thank you. >> i thank the senator. senator sessions, and i want to thank senator sessions for his courtesy, knowing that i need to leave here at noon. i appreciate very much how he held off in his round in case w >> thank you, mr. chairman. mr. elmendorf, i appreciate cbo's work. i think you do very valuable work. you missed the gdp this year. i think you were at 2.7 predicting it and it came in at 1.7. but mr. zandi at the great moody's was at 4%, and it came in at 1.7. so i give you credit fo
economy of worse outcome in europe. i think that is a topic we've discussed a number of times in our panel of economic we built into this projection shallow recession in europe, which is consistent i think with the latest consensus forecasts. we didn't find a way to quantify a particular alternative european scenario. and part of that is it's very -- we're very unsure what the financial connections are. and just how a particular sort of financial debacle in reverbe financial institutions. it's...
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Feb 2, 2012
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we spent some time discussing europe here today. in your interaction with ecb officials and others, but what i'd like to hear from you, doctor, is what preparation our fed has made for an orderly -- excuse my, a disorderly default by greece or the other countries within europe? i haven't heard any specifics there. you indicated that the fed is prepared to use all the different liefers that you have. so that is the general questionment but specifically, i'd also like you to speak to the money market mutual fund market. right after lehman, there was a bailout of the money market mutual funds because over panic over breaking the buck. that is the investment income wouldn't cover all operating expenses. it wouldn't cover all the investment losses. and so there was an intervention by the united states into that market. could that also be something that people begin demanding right here in washington? we bail out the money markets as a result of a disorderly default in europe? >> so in terms of preparations, other than beyond the swaps wh
we spent some time discussing europe here today. in your interaction with ecb officials and others, but what i'd like to hear from you, doctor, is what preparation our fed has made for an orderly -- excuse my, a disorderly default by greece or the other countries within europe? i haven't heard any specifics there. you indicated that the fed is prepared to use all the different liefers that you have. so that is the general questionment but specifically, i'd also like you to speak to the money...
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Feb 2, 2012
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if that context there's been a lot of discussion in europe about the banning of naked shorts. that is not able to buy a credit default swap unless you own the underlying investment. i believe that one step in that direction was taken back in october, and if the proposal is ratified, i think it would go into effect in november of this year, something like that. is there a fierce argument back and forth as to whether that's valuable or not? >> my understanding is some financial institutions in europe are still banned from unsovereign debt. to be frank, i think it's swa a misguided approach. a lot of people want to be able to ensure against risk and they want to be able to use the market to that end. if this were a transparent market, if you could trace through underlying exposures, both on a gross and net basis in real time, i think from a sys m systemsyste systemic stability point of view, we could become more comfortable with it. mega banks take proprietary positions, for example, betting the house. senator conrad made a bet. it doesn't have to be through a naked position nece
if that context there's been a lot of discussion in europe about the banning of naked shorts. that is not able to buy a credit default swap unless you own the underlying investment. i believe that one step in that direction was taken back in october, and if the proposal is ratified, i think it would go into effect in november of this year, something like that. is there a fierce argument back and forth as to whether that's valuable or not? >> my understanding is some financial institutions...
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Feb 1, 2012
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one is the financial disruption in europe, the other is the conflict in the middle east. that's the risk we're fairing in 2012. neither of which occur, we're very likely to stay until that band. >> thank you, mr. chairman. let me ask dr. gruenspech stlau in your sm here that they're a fuel of liquid fuels dropped from 49% last year -- not last year but 2010, to 27 percent in 2014 and 23 by 20, by. >> this was made not including as a result of the fuel economy standards. you have calculated if these fuel economy sand ard which have been announced by the situation and which the auto industry and -- if those are included, what does that do to the percentage of liquid fuels that we have to import? >> dhaeng you, mr. chairman. we are certainly going to include that in our -- a case like that in our pulls can it makes a significant i'd say in the 2035, liquid fuel consumption would probably be lower by million -- 1.4 million barrels a day, roughly. i'm trying to remember the number. and most of that would come out of imports. so it's a pretty big deal. >> so instead of it being
one is the financial disruption in europe, the other is the conflict in the middle east. that's the risk we're fairing in 2012. neither of which occur, we're very likely to stay until that band. >> thank you, mr. chairman. let me ask dr. gruenspech stlau in your sm here that they're a fuel of liquid fuels dropped from 49% last year -- not last year but 2010, to 27 percent in 2014 and 23 by 20, by. >> this was made not including as a result of the fuel economy standards. you have...
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Feb 7, 2012
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we mentioned europe as another one. mentioned the question 69 sequestration and you know, to me, that will alone puts a very negative spectacle you know out because it would mean that in a lame duck session in the 2012 congress, you would see, again, the same sort of flailing that you did after 2010. so my first question to you on the shock issue is, doesn't it serve to shock our economic system just to have all this delay and week after week of bickering and inability to get decisions on whether it's payroll taxes or others? isn't that in and of itself a shock to the system in term of what it does to business confidence and predictability and uncertainty? >> well, policy uncertainty is certainly one of the things that businesses complain about, makes it harder to plan. you know, we face the same issue as regulators with regulatory uncertainty and obviously, to the extent that greater clarity can be provide, it would be helpful to the economy. >> and is it fair to describe that as yet another shock to the system? becaus
we mentioned europe as another one. mentioned the question 69 sequestration and you know, to me, that will alone puts a very negative spectacle you know out because it would mean that in a lame duck session in the 2012 congress, you would see, again, the same sort of flailing that you did after 2010. so my first question to you on the shock issue is, doesn't it serve to shock our economic system just to have all this delay and week after week of bickering and inability to get decisions on...
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Feb 29, 2012
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there's no equivalent of federal government in europe. and so part of their reform process is seeing what extent they should be greater fiscal union. overall, it's true that europe doesn't have a bigger deficit than we do. so that's certainly true. all i can say is that mr. draggy certainly is right for the peripheral countries like greece and portugal and ireland which really no alternative but to tighten belt immediately. there may be more flexibility in other countries. >> okay. i understand that. but with our debt to gdp now over 100%, with these comparable short term manual deficits when we look at europe, with comparable structural deficits, at what point do our general calls for debt reduction become more in line with the comments that your counterpart is making? at what point do we ring that bell and say the long term structural adjustments have to be made? >> you mentioned 8.5%. part of that is cyclical. part of that can be addressed by having the economy recover. part of it is structurastructur. in other words, it's not better o
there's no equivalent of federal government in europe. and so part of their reform process is seeing what extent they should be greater fiscal union. overall, it's true that europe doesn't have a bigger deficit than we do. so that's certainly true. all i can say is that mr. draggy certainly is right for the peripheral countries like greece and portugal and ireland which really no alternative but to tighten belt immediately. there may be more flexibility in other countries. >> okay. i...
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Feb 29, 2012
02/12
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europe was part of the problem there and then it starts to rise again. not only does it show a significant -- it shows the worst time was around the time of change in administration and increases in early 2000 and nine and the point now where the monthlyin 2012 are equal to what they were in 2005. the total losses were so great that we have not yet under cut it and i note that you point out, while we have had improvements in the private sector, it has been diminished by state and local governments. the fact is if state and local governments had been even, no gain but have not lost over half a million, then unemployment would now be under 7%. we are moving well as i see it, one of the major problems we have got, i guess i'll not ask you to comment, i will just say it. one of the major obstacles or problems that might keep us from a continued upward trend, which is a good trend, although slower than we would like is troubles in europe. i know, the role that you and your agency have played in helping to get europe on avoid greater troubles has beenf helpful
europe was part of the problem there and then it starts to rise again. not only does it show a significant -- it shows the worst time was around the time of change in administration and increases in early 2000 and nine and the point now where the monthlyin 2012 are equal to what they were in 2005. the total losses were so great that we have not yet under cut it and i note that you point out, while we have had improvements in the private sector, it has been diminished by state and local...
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Feb 7, 2012
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capital out of europe and into safe u.s. assets, and new business formation is at a record low. he said they're detroying invest and the willingness of banks to loan to anyone but those whose credit is so strong they don't need the loans. can you respond to that? >> i disagree with that completely. i think first of all, one of the goals of our asset purchase program is to take safe treasury out of circulation and push investors intoing situations that are appropriately risky. making loans, buying corporate debt an taking actions, hiring, investing, they'll expand the economy. they are very hunkerred down to a riskier position positive for the economy. they have to ask, what is the alternative in the alternative is low yielding treasury securities. so with making 2% on the treasury, that's a low bar for making a ten-year loan to a new business. that encourages lending. i think it reduces uncertainty. it increases firms to invest vest. i know my time is up. i would also see the booming of interest rates to the debt and addressing the issue right away. thank you. >> next is -- >> t
capital out of europe and into safe u.s. assets, and new business formation is at a record low. he said they're detroying invest and the willingness of banks to loan to anyone but those whose credit is so strong they don't need the loans. can you respond to that? >> i disagree with that completely. i think first of all, one of the goals of our asset purchase program is to take safe treasury out of circulation and push investors intoing situations that are appropriately risky. making...
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Feb 10, 2012
02/12
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. >>> coming up on c-span 3, angela merkel talks about the future of europe. the senate budget committees looks into the eurozone crisis. and later, airport security. on tomorrow worn -- morning's, "washington journal" a discussion on cyber security and a talk with senator barrasso of wyoming. he is trying to work out an agreement on extending the payroll tax cuts for the rest of the year. and a look at how the federal government measures price increases and how inflation affects entitlement programs such as social security. our guests are michael horigan. "washington journal" is live at 7:00 a.m. eastern. >>> just so i'll remember, here is that wonderful moment when senator lott revealed his nostalgia for the state's right segregationist south. take a look. >> when strom thurmond ran for president we voted for him. we were proud of him. >> talking points memo fpt com josh marshall on the internet and the website's emergence into the breaking news business. >> the media is such a different system than it was years ago. i think things like that happen all the t
. >>> coming up on c-span 3, angela merkel talks about the future of europe. the senate budget committees looks into the eurozone crisis. and later, airport security. on tomorrow worn -- morning's, "washington journal" a discussion on cyber security and a talk with senator barrasso of wyoming. he is trying to work out an agreement on extending the payroll tax cuts for the rest of the year. and a look at how the federal government measures price increases and how inflation...
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Feb 1, 2012
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but also europe and china, other markets. one more challenging aspect to the efficiency efforts are buildings and structures. cars on the road for maybe 12 years, a building can be around for 100 years. and encouraging, providing incentives for greater building efficiency could go a long ways. >> yes. mr. diwan. let me ask a very quick final question for dr. gruenspecht since you mentioned heating oil in the northeast. i'm very concerned about pad one, as you pointed out. you talked about the refineries that are down on the east coast. can you talk about the correlation between that, if there is any, and what we're seeing in increased costs for home heating oil in the northeast. >> thank you. i don't think there's really much correlation. i describe the broader picture of gasoline and distillate and, you know, as senator brasso pointed out, distillate prices in wyoming are very high. i don't think this refinery issue this winter so far has been much of the issue. i would point out that in our -- we do a winter fuels outlook a
but also europe and china, other markets. one more challenging aspect to the efficiency efforts are buildings and structures. cars on the road for maybe 12 years, a building can be around for 100 years. and encouraging, providing incentives for greater building efficiency could go a long ways. >> yes. mr. diwan. let me ask a very quick final question for dr. gruenspecht since you mentioned heating oil in the northeast. i'm very concerned about pad one, as you pointed out. you talked about...
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Feb 21, 2012
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war erupted in europe a year later. america entered in 1917. when the war was won, wilson sailed for france to receive there a heartfelt welcome. at the peace conference, he worked tirelessly to weld the covenant of the league of nations into the versailles treaty. the president returned to america a newer claim for his own people. still more honors were heaped upon him. for his labors of peace, he was awarded the nobel prize. but his endeavors had taken a severe toll. although the president continued to toil with his remaining energies for lasting world peace. >> let's go over to the dining room. on our way you'll see the beautiful solarium sun room. we are here in northwest washington d.c. off massachusetts avenue and embassy row. unlike the older neighborhoods in washington, capitol hill or georgetown. embassy row is a 20th century plan. so there's wonderful gardens, landscapes. we see beyond the terrace garden a busy massachusetts avenue. and here you turn around, 24th street on to a very quiet residential street. 2340 s street. during the
war erupted in europe a year later. america entered in 1917. when the war was won, wilson sailed for france to receive there a heartfelt welcome. at the peace conference, he worked tirelessly to weld the covenant of the league of nations into the versailles treaty. the president returned to america a newer claim for his own people. still more honors were heaped upon him. for his labors of peace, he was awarded the nobel prize. but his endeavors had taken a severe toll. although the president...
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Feb 2, 2012
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so the question i would have of netflix, if you have it in europe, does somebody every movie have an opportunity to opt out? >> on the current implementation in europe, there's an opt-out don't share opportunity. >> every time? >> mr. wolf pointed out, it's not available on every device. it's available on every computer but the implementation is that you start the movie, the presumption is share and deal with the movie you can elect not to share and then after the movie is displayed on facebook, you can go back and adjust the setting to unshare that. >> here's my question. what he is the difference between an unshare opt out and a share opt out? they are both asking the same question. one's presumption, you're going to share all the time but you're still making a decision each movie. unshare or not unshare. >> well, one is opt in and one is opt out. >> yes. but the decision for privacy is still made individually on every movie that they send downstream. what's the difference? of having an opt in or opt out? if the whole argument is that they have the same thing? >> it doesn't defeat
so the question i would have of netflix, if you have it in europe, does somebody every movie have an opportunity to opt out? >> on the current implementation in europe, there's an opt-out don't share opportunity. >> every time? >> mr. wolf pointed out, it's not available on every device. it's available on every computer but the implementation is that you start the movie, the presumption is share and deal with the movie you can elect not to share and then after the movie is...
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Feb 3, 2012
02/12
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the effects of europe on the u.s. economy, or the effects of the european financial implosion on the u.s. economy are of course very complicated. part of that you mentioned this earlier, if they're out of work, buying less, one place they'll buy less from is here. an important channel of transmission from their problems to us is through the financial system. we have had a number of conversations on this topic with our panel at economic advisers in the past several meetings. their view is really on the financial side. i think the current understanding is that u.s. financial institutions don't have a lot of direct exposure to the most troubled economies in europe. but as we saw in the financial crisis here, the danger comes not just from the one link away. it's two or three links away from this interconnected system. >> let me sneak one last point in here. currently a huge debate is really about the expiration of the bush tax cuts and differentiating them from the wealthy and the less well off. what is the effect of the
the effects of europe on the u.s. economy, or the effects of the european financial implosion on the u.s. economy are of course very complicated. part of that you mentioned this earlier, if they're out of work, buying less, one place they'll buy less from is here. an important channel of transmission from their problems to us is through the financial system. we have had a number of conversations on this topic with our panel at economic advisers in the past several meetings. their view is really...