November 27, 2017 - This Policy Brief was prepared by SEP President Stefano Micossi. In it, he argues that the ultimate anchor of a stable banking union would be credible policies to reduce excessive sovereign debt-to-GDP ratios. Accordingly, Professor Micossi believes that a combination of a strengthened debt rule in the Stability and Growth Pact and a market discipline mechanism entailing the obligation to issue junior bonds -- subject to restructuring -- for the countries violating the common budgetary rules could offer a suitable way forward to restore the credibility of the Pact.
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|Micossi Policy Brief.pdf||492.24 KB|