The bad assets will continue to suck resources from the economic system as a zombie borrowers, poor distribution and distorted price of capital, public debt and budget deficits. a But beyond the modality adopted the proposal (although this is not a minor issue), the truth is that the creation of the entity increases the chances of a faster economic recovery U.S. because the U.S. financial system would take the fight to clean up their balance sheets and put it in a position to generate credit for consumption and productive investment. a With a financial system recovered and historically low interest rates, the U.S. economy, highly dependent on domestic consumption, may speed your recovery and it represents a more than good news for the rest of the world economy. a The positive impact of the establishment of the bad bank to encourage other policymakers to adopt the proposed resolution of this crisis.
Thus, a positive result in the application of the methodology of resolution in the U.S.. UU. could prompt the European Central Bank to take a similar measure that would benefit the financial system of the eurozone. a In the meantime, what can be said is that this proposal has brought some hope for that economies can cope with the crisis and accelerate out of the crisis. a But be aware that both this draft resolution as the previous steps taken by governments, perverse incentives arise in the future conduct of financial institutions on which it must work seriously.
a The other issue that should be working is on the strength of macroeconomics mainly in developed countries. Among other consequences, the crisis has forced the developed economies to incur large fiscal costs to mitigate its impact, which will entail a greater burden of debt in the future. These economies will emerge from the crisis hit and require urgent action to prevent the continued deterioration of the macroeconomic variables that may make them vulnerable to further adverse shocks. a Latinforme. com is the main source of financial information and independent opinion on American and global markets from a Latin American perspective. From our offices in Buenos Aires, Argentina, I approached the latest news and alerts to help you gains obtained regardless of the direction taken by the market.
