Banking union in historical perspective: the initiative of the European Commission in the 1960s-1970s

This article shows that planning for the organization of EU banking regulation and supervision did not just appear on the agenda in recent years with discussions over the creation of the eurozone banking union. It unveils a hitherto neglected initiative of the European Commission in the 1960s and early 1970s. Drawing on extensive archival work, this article explains that this initiative, however, rested on a number of different assumptions, and emerged in a much different context. It first explains that the Commission's initial project was not crisis-driven; that it articulated the link between monetary integration and banking regulation; and finally that it did not set out to move the supervisory framework to the supranational level, unlike present-day developments

Rethinking European integration history in light of capitalism: the case of the long 1970s

This introduction outlines the possibilities and perspectives of an intertwining between European integration history and the history of capitalism. Although debates on capitalism have been making a comeback since the 2008 crisis, to date the concept of capitalism remains almost completely avoided by historians of European integration. This introduction thus conceptualizes ‘capitalism’ as a useful analytical tool that should be used by historians of European integration and proposes three major approaches for them to do so: first, by bringing the question of social conflict, integral to the concept of capitalism, into European integration history; second, by better conceptualizing the link between European governance, Europeanization and the globalization of capitalism; and thirdly by investigating the economic, political and ideological models or doctrines that underlie European cooperation, integration, policies and institutions. Finally, the introduction addresses the question of the analytical benefits of an encounter between capitalism and European integration history, focusing on the case of the 1970s. This allows us to qualify the idea of a clear-cut rupture, and better highlight how the shift of these years resulted from a complex bargaining that took place in part at the European level

International money markets: eurocurrencies

Eurocurrencies are international markets for short-term wholesale bank deposits and loans. They emerged in Western Europe in the late 1950s and rapidly reached a global scale. A Eurocurrency is a form of bank money: an unsecured short-term bank debt denominated in a currency (for instance, US dollars) but issued by banks operating offshore, in a geographical location or a legal space situated outside of the jurisdiction of the national authorities presiding over that currency (for instance, the Federal Reserve). In Eurocurrency markets, banks intermediate mainly between foreign residents. They borrow funds by "accepting" foreign currency deposits and lend foreign currency-denominated funds by "placing" deposits with other banks, by granting short-term loans or investing in other liquid assets. Historically, Eurodollars accounted for the largest share of Eurocurrencies, although other international currencies (Deutsche Marks, Japanese yens, and especially Euros since 1999) played an important role. Eurocurrency markets were a manifestation of financial integration and interdependence in a globalizing economy and performed critical functions in the distribution and creation of international liquidity. At the same time, their fast growth was a recurrent source of concerns for central bankers and policymakers due to their implications for macroeconomic policies and financial stability. This chapter analyzes different aspects of the historical development of Eurocurrency markets and their role in the international monetary and financial system. The first part discusses theoretical interpretations, presents estimates of markets' size, describes their structure, and explains the determinants of their growth. The second part analyzes the spread between Eurodollar rates and other US money market rates, the role of arbitrage, the evolution of risk factors, and the causes of historical episodes of stress and contagion in the interbank market. The last part discusses political economy issues, such as the role of governments and market forces in the emergence of Eurodollars in the 1950s and the failed attempts to impose multilateral controls on Eurocurrency markets in the 1970s

The Euro Crisis: A Historical Perspective

In this research report IDEAS explores the current euro crisis by looking at the debates preceding the conception of the euro. How can the early days of EU monetary cooperation help us understand today's predicament? And what lessons can we draw from them for the euro? <br/> Today's debates about the viability of the eurozone bear a striking resemblance with those about the creation of a European single currency in the late twentieth century. The early steps of European monetary cooperation, the negotiations over the creation of the European Monetary System (EMS), those over the creation of the euro, as well as the other plans suggested which eventually failed (the proposal for a European parallel currency for instance), help us better understand the challenges that the euro faces today. Many of the issues at stake then are indeed still central to debates now. The question of the transfer of resources from richer to poorer member states, the adoption of a German-inspired interpretation of monetary policy, to take but two examples, are issues that anyone reading today's newspapers will be familiar with. This paper argues that looking at these past debates do not just provide an insight into the past – but also helps us better understand our current predicame

Les banquiers centraux de l'échec du plan Werner à la création du SME, 1974-1979

Cet article analyse le rôle des banquiers centraux dans la coopération monétaire européenne, de l’échec du plan Werner à la création du Système monétaire européen (SME). Le rôle des banquiers centraux dans les négociations du SME est généralement considéré comme mineur : la principale caractéristique des négociations de 1978 fut en effet l’effort du président français Valéry Giscard d’Estaing et du chancelier allemand Helmut Schmidt pour éviter les banquiers centraux, prévoyant leur opposition au projet franco-allemand. Utilisant des archives allemandes, britanniques, françaises et communautaires, cet article insiste plutôt sur la continuité de la coopération entre banquiers centraux durant la seconde moitié des années 1970, la formation progressive d’un consensus autour de la position de la Bundesbank, et souligne combien les banquiers centraux sont insérés dans une élite monétaire transnationale plus large incluant conseillers économiques et ministres des Finances

More than a prestigious spokesperson: the role of summits/the European Council in European Political Cooperation (EPC), 1969-1981

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