Like the subprime mortgage crisis of the late 2000's, the European sovereign debt crisis is infecting markets around the world. In addition to occupying headlines, the crisis has caused many financial institutions and manufacturers globally to adopt conservative strategies — retaining cash and deferring major investments — until greater clarity can be obtained. The impact on the global economy has been significant.
Like in the late 2000's, debates rage as to the proper role of government in curbing systemic risk. In this session, we will explore the political and regulatory responses that have been or may otherwise be implemented throughout the EU. Where applicable, we'll compare and contrast those responses to political and regulatory responses in the United States and elsewhere when confronting systemic risk.
- What, if anything, is systemically important or too big to fail? Financial institutions? Manufacturers? Utility providers? Governments?
- Are the problems associated with systemic risk new -- a creature of modern economies and complex financial transactions -- or have we faced these issues throughout history?
- What is at the root of the European crisis? Insufficient government austerity measures? Failures in concept and design of the EU? Bank practices? Bank regulation and policy?
- How have the EU States, both individually and collectively, responded to the crisis?
- How do these responses compare to those of the U.S. government in connection with the subprime crisis of the late 2000's? For that matter, how do they compare to other "bailouts" throughout history?
- What comes next? What practical takeaways are there for lawyers, financial advisors and clients? Does the stress in Europe present any opportunities? Are certain industries / markets more likely to be key targets for investment or financial stress? What are the risks in pursuing these opportunities?