According to the New York Times, the IMF had more influence
in the European debt crisis than did many E.U. states. Put another way,
Christine Lagarde, head of the organization, became “a quasi head of state.”
Without the advice and money from the IMF, the euro might have collapsed. If
one could believe the rhetoric, the E.U. itself might have broken up. But the
threat to the Union lies not in the euro, but, rather, on the emphasis on the
state governments and in particular their respective officials. Indeed, the
crucial role of the IMF during the debt crisis may have been in looking out for
the interests of the E.U. in contradistinction to the various interests of the
state governments. “In the absence of a strong federal government in Europe,”
according to the Times, the IMF has helped “impose order on quarreling [state]
leaders.” Put another way, if the balance of power in the federal system did
not reside with the states at the expense of the federal government, the
Europeans would not have had to rely on the IMF so much. For example, Lagarde played an important role, according to
the Times, in “overcoming German reluctance to accept proposals intended to
strengthen the euro zone, like a centralized bank supervisor.” Because the
proposals involved shifting additional governmental sovereignty from the state
governments to the federal level, the heads of the state governments faced a
conflict of interest in assessing whether to support a federal regulator even
though it would be in the interest of the whole.
Saturday, April 20, 2013
Is the E.U. Relying Too Much on the IMF?
Monday, April 15, 2013
JPMorgan’s Management: Overly-Defensive From Weakness?
According to the Wall Street Journal, at JPMorgan, the
largest U.S. bank by assets, revenue in the first quarter of 2013 fell 4% from
the same period a year earlier. The mortgage squeeze affected the firms'
overall results. Net-interest income, which reflects the amount a bank makes
from its loans, dipped 6%, to $10.9 billion, from a year earlier. Even so, J.P.
Morgan's net income rose 33%, to $6.53 billion, or $1.59 a share, as a jump in
investment-banking income and a cut in expenses helped cushion the mortgage
pullback.
The full essay is at "JPMorgan: An Unethical Monstrosity?"
On the Roles of Mentors and Sponsors in Leadership Development
In the corporate world, distinguishing between a mentor,
sponsor, and leader can be difficult. As people can get carried away in
describing their roles, it is necessary to clearly demarcate the three. According
to Sylvia Hewlett , mentors “act as a
sounding board or a shoulder to cry on, offering advice as needed and support
and guidance as requested.” A sponsor is “a powerfully positioned champion” who
offers “guidance and critical feedback.” Although appropriating “champion” from
sports does not fit, the distinction between critical feedback and “support and
guidance” is worth exploring.
Material from this essay has been incorporated into The Essence of Leadership: A Cross-Cultural Foundation, which is available in print and as an ebook at Amazon.
Source:
Sunday, April 14, 2013
European Central Bank As Supervisor: Conflicts of Interest
Wolfgang Schäuble, the German finance minister, raised
additional concerns in April 2013 about a proposal to create a single banking
supervisor for the European Union. About 150 large banks would be under the
direct supervision of the European Central Bank, which would also have the
power to intervene to oversee smaller lenders. This proposal had been set as a
precondition for states to draw on the E.U.’s bailout fund, the European
Stability Mechanism, to recapitalize struggling lenders directly. To analyze Schäuble’s
potential stumbling blocks, it is necessary to understand the conflicts of
interest that are involved.
The full essay is at "Essays on the E.U. Political Economy." Available at Amazon.