Monetary policies responded differently to the Great Financial Crises on both sides of the North-Atlantic. And those differential approaches have been seen as one of the causes for divergent developments between Europe and the U.S. In fact, while it is conventionally held that the ECB responded only reluctantly to the crisis, the first non-conventional policy operations (“full-allotment at a fixed rate”) were already conducted by the ECB in August 2007. Still, in the fall of 2008, the nadir of the financial crisis, the Federal Reserve embarked forcefully on a series of large-scale asset purchase programs. On the other side of the Atlantic, the European Central Bank implemented concurrently a different set of non-standard policies. These so-called “enhanced credit support” measures, intended to support access to as well as terms of credit flows, reflected the Euro Areas largely bank-oriented financial systems. To tell the difference between policy approaches on both sides of the Atlantic it is indispensable to account for the differences in institutional as well as financial-structural background conditions.
In this lecture, Yves Mersch, Member of the ECB’s Executive Board, will address those differences in background conditions (including supervisory regimes). He will also touch upon further monetary policy topics as they are currently discussed in Europe. Yves Mersch is particularly qualified for this role. He was, inter alia, as Directeur du Trésor, personal representative of Luxembourg’s Finance Ministry in the negotiations of the Maastricht Treaty, Member of the Board of the Luxembourg Monetary Institute and Governor of Luxembourg’s Central Bank. Mr. Mersch has received many awards, e.g., l’Ordre National de la Légion d’honneur, France) as well as Grand Officer of the Cross of Recognition (Latvia). Since 2015 he is also an Honorary Professorship at Université de Luxembourg.