Isabel Schnabel - Enhancing Stability in the Euro Area
Channel: IIEA
Date: 2016-04-04

About the Speech:
 
Dr. Jochen Andritzky, Secretary General of the German Council of Economic Experts since June 2015, gave a brief introductory remark about the Council and its latest annual report which was handed over to Chancellor Merkel in November 2015.
 
Following this, Professor Schnabel outlined in her lecture the proposal of the German Council of Economic Experts for a stable framework for the euro area. One central element is the proposal to introduce an insolvency regime for sovereigns. In order to mitigate the sovereign-bank nexus in the euro area, privileges for sovereign debt in banking regulation would have to be phased out. The Council has therefore presented a proposal on how this could be done. Furthermore, Professor Schnabel discussed the consequences of the low interest rate environment in the euro area. The Council cautions against a further loosening of monetary policy as the risks to financial stability from low interest rates threaten to exceed the benefits.
 
About the Speaker:
 
Isabel Schnabel became a Member of the German Council of Economic Experts in June 2014. She has been a Professor of Financial Economics at Johannes Gutenberg University Mainz since 2007. She has been a visiting scholar at the International Monetary Fund (IMF), the London School of Economics, and Harvard University. She is also a member of the Advisory Board and Administrative Council of the German Federal Financial Supervisory Authority (BaFin).