«L-fall of the dollar? I believe that the loss of value will continue ... the economic fundamentals and capital flows that move the market do not play in favor of our currency. " With the pragmatism of the great American bankers, and especially from 10 years of experience at the top of the New York Fed and the Federal Open Market Committee, the executive body of the monetary policy of William McDonough gets straight to the point: the fall the dollar is taking place not only for the emotional drive of the expectations of the markets to the general perception that ¨ the dollar should come down to "above all explained McDonough thing, because traders are pessimistic on the prospects of the dollar believe that the deficit currents of the United States is now insostenibileÂ. In other words, according to the banker who has worked for 10 years alongside Alan Greenspan and now, 72 years, à ¨ Special Adviser of the President of Merrill Lynch's Stan O'Neall'Europa à ¨ good that it brings into account a period Prolonged weakness in the greenback, with all the consequences.  "If the United States this devaluation of the currency à ¨ inevitable and healthy in some ways the American banker says, in for meetings and for institutional strengthening old ties (Â" I know personally and I appreciate Tommaso Padoa Schioppa from the days when he presided over the Committee on Payments and Settlement Systems in, "admitted discreetly) for Europe à ¨ serious risk: the race 'Euro could lead to loss of export competitiveness of enterprises, with impact on economic growth." McDonough, who will be present in Milan at the awards ceremony 'Oscars of the accept the comparison with the Sole 24 Ore ".
Mr. McDonough, with the Euro which has gained 11% since the start 'years on the dollar, the perception of financial markets by ¨ the tensions and imbalances or imbalances, as you say in the U.S. capital flows . Quality is his vision?
The fall of the dollar ¨ certainly reflects a very high current account deficit in the United States and imbalances in the flows of capital. We are in a new situation with the past: the prices of commodities are at very high, are at historically low real in America and the dynamics 'European economy and the Asian à ¨ certainly better than the American. Pià ¹ the dollar weakens, pià ¹ increases the risk that Asian countries ribilancino their foreign reserves penalizing the greenback. In other words, we are in the midst of a gradual rebalancing of global currency reserves, currently for 66% in dollars, euros and 23% for the difference in Sterling and Yen, the dollar will continue to decline until After this process, which in fact reflects the new balance in the world economy. And with a U.S. current account deficit that knoppix is about 7% of this process also in the interest of Washington.Ed à ¨ à ¨ useless hide behind the assumption that the strong dollar is a dogma.
What you should do today to strengthen the global financial system? Sees risks of
Risks always exist. Today c'a ¨ who fear a in the Chinese banking system. In my view, a fundamental role in strengthening the system will pua ² and the IMF should play: is here that can be bred ² controlling the rebalancing of large capital flows.
Pià ¹ in general, à ¨ crucial how à ¨ pagament managed system of settlement, ¨ cioa the settlement of securities and payment of funds worldwide. Another area of work ¨ strengthening the global banking system, we must ensure that all parts of the world banks have the same, strong, capital requirements and must also be sure of how the system ¨ supervised and administered.
The big U.S. banks licensed to New York and strengthen their offices in Hong Kong, Shanghai. How do you respond to those who expected a loss of centrality of the U.S. financial system?
I reply that the phenomenon à ¨ pià ¹ very complex than sembri.Le large international banks follow or anticipate the evolution 'global economy, moving their assets in light of opportunities: what ¬, will become the center of decision-making in 'Europe, Middle East and Africa, Tokyo and Hong Kong will manage operations for the Pacific, while New York will still have a central role in the American and South American market. Again, à ¨ an ongoing rebalancing of equilibria.
Do you think the London stock exchange consolidation is part of this trend?
Certamente.In recent years c'a ¨ was a significant strengthening of the national stock markets, but now it is opening a new phase. The interdependence of world economies makes ìòà that the capital market to push for the integration of squares persist in defending the national situation ¨ Ã therefore contrary to the logic of the market.
I n other words, she considers anachronistic attempt to create a square in area for the Euro?
I capirele the political motivations that lead some governments to oppose the plans for transatlantic integration of equity markets, but I can not share: is always the market decide.
Then sees the risks in terms of investor protection? There are different laws tragliStati U.S. and Europe regarding the protection of savings ...
I do not see rischiparticolari, although A ¨ no doubt that in perspective the importance of increased cooperation between supervisory authorities of financial markets. I can not say whether it is appropriate for Europe only modelloSec acquire an authority, but I think for the stock market is certainly possible to replicate that model of banking supervision that move has been created with the Basle Committee, and between l ' I chaired another before handing the baton to Tommaso Padoa Schioppa.
In Europe, many fear that with the merger between Euronext and NYSE are also exported to the strict American laws relating to savings, cioa ¨ Law SarbanesOxley ...
Not seem to me that is something ¬ and in any case in the United States à ¨ During a profound reworking of some of the major provisions of Sarbanes ¹ disputed, such as Section 404 of the controls and the certification 'audit of listed companies. Sarbanes will not change the SEC pua ² Only Congress change the laws but the authority pua ² certainly soften the way in which this applicata.E à ¨ à ¨ what is happening.
I therefore think that the emergency legislation generated by the Enron and Worldcom is now outdated?
Sà ¬, I think the worst is past. Companies have realized that fraud leads to harsh punishments and that transparency, good governance, leading to a cost of capital ¹ pià certainly low.
¨ As the emergency phase and the laws enacted to answer were very costly for companies and auditors, now in ¨ the time to think about a rebalancing of the weights. That said, I think in terms of monitoring the guard must never be lowered.
As chairman of the Fed of New York, led the rescue Long Term Capital management.Oggi the hedgefund have a decisive bearing on the financial system mondiale.Ha fears?
The world ¨ allorae different from the financial market is greatly expanded à ¨: à ¨ difficult now that of a fund, however large, can cause systemic. Look, the truth ¨ pià ¹ news today is that the birth of a hedge fund that her disappearance: she knew that between January 2005 and September 2006 were cleared over 1,000 The system, today, ¨ able to absorb the shock.
Finally: What do you think of the Italian situation?
L Ã ¨ an important country for Merrill Lynch: is the second country after Britain in EMEA. Regarding the economy, I will not go into the legal but I can say that your country seems determined to bring the accounts under control and the relationship between deficit and below the threshold of 3%. Certainly c'a ¨ to do much in terms of liberalization and quality of services. Among other things: they are no tie to this interview thing, because the airline I flew with which I lost my suitcase ... you guess her name.

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