The subordination of European finance

Grahl, John (2011) The subordination of European finance. Competition and Change, 15 (1). pp. 31-47. ISSN 1024-5294 (doi:10.1179/102452911X12905309381978)

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Abstract

European political leaderships have responded to the emergence of global finance with a sustained drive to integrate Europe's own financial systems on the basis of a switch from classical bank credit to tradable securities. In itself, this was a rational response. However, financial integration was pursued at breakneck speed and in disregard of important public goods including economic stability and social justice. Reforms were undertaken in a climate of moral panic, in the false belief that the EU faced a serious problem of external competitiveness. In consequence, Europe's banks and institutional investors were badly exposed to the sub-prime crisis, the Eurozone has been radically disorganized and the EU has had little influence on the evolution of global financial structures and practices.

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