As world leaders prepare to head to Pittsburg for the G20 Summit, it is still not clear if Europe and the US will be able to work out some of their differences on reforms to financial regulation.
Europe says that is needed to prevent the kind of risk-taking that helped create the economic crisis. German Chancellor, Angela Merkel said they are “on the right track. But a deal has not been sealed.” She added: “Every financial market product, every institution, and every financial marketplace should be subject to regulation, and as a whole it must be a coherent move internationally.” She and German Finance Minister Peer Steinbrueck want regulations in place by the middle of next year: Steinbrueck said: “There is still a lot to do and I think that in our discussions today we agreed that a clear timetable must be set out at the meeting in Pittsburgh about what should be dealt with and by what date.” Steinbrueck and Merkel said one of the lessons learned was that major international banks have to hold bigger reserves to avoid any future financial crisis. Neither felt that a consensus could be reached at this week’s G20 meeting about a tax on financial transactions.