"It is essential that the EU banking union is completed by putting in place the last pillar, a common deposit guarantee scheme, together with efforts to reduce risks to the financial system". He supports it Christine Lagarde, managing director of the International Monetary Fund in his Global Policy Agenda, his recipe for “decisive action, lasting recovery”. The dig at Germany by Merkel and above all by Schaeuble is clear, resisting the implementation of the third pillar of the banking union for fear, considered by many to be entirely specious, about the stability of Italian banks which have many government bonds in their portfolios. Lagarde is now in the same line as the president of the ECB, Mario Draghi.
The IMF number one also argued that nations should increase theirs commitment to drive growth and demand: “In this context it is appropriate that monetary policy remains accommodative where inflation is too low but that policy alone is not enough; the adoption of structural reforms is crucial,” Christine Lagarde said.
From Washington, Lagarde presented her Global Policy Agenda, the recipe for "decisive action, lasting recovery" made up of three ingredients: monetary, fiscal and structural actions. Taken together "they can create a virtuous trinity that strengthens economic activity and reduces the risks to stability". The woman at the head of the institute is pressing those nations that have the fiscal space "to further ease their fiscal policies, which would benefit them and support global demand". On this front, Lagarde cites Canada as a country that is doing so. In any case "all countries, including those without fiscal space, can contribute by aiming for a composition favorable to the growth of revenues and expenditures, especially by increasing spending on infrastructure in some countries".
