Europe finally has a central banking authority, a move that many politicians and economists believe will help pull the region out of its financial crisis. It is hard to argue definitely this will happen. Leaders in Europe have set a number of other plans, such as a permanent bailout authority. These have not yielded the reaction in the markets they had hoped for. And squabbling among nations after plans have been set often undermines them.
Europe clinched a deal on Thursday to give the European Central Bank new powers to supervise euro zone banks from 2014, embarking on the first step in a new phase of closer integration to help underpin the euro. After more than 14 hours of talks and following months of tortuous negotiations, finance ministers from the European Union’s 27 countries agreed to hand the ECB the authority to directly police at least 150 of the euro zone’s biggest banks and intervene in smaller banks at the first sign of trouble.
Douglas A. McIntyre