The Bank for International Settlements (BIS), a group representing central banks including the Federal Reserve and the European Central Bank, on Sunday warned European political leaders that they should not expect central banks’ cheap-money policy to hold the global economy together forever. http://www.nytimes.com/2013/06/24/business/global/central-banks-criticize-europe-for-political-gridlock-on-economy.html?hp The B.I.S. report avoided singling out individual countries, but it was clear that much of its criticism of economic policy was aimed at leaders in Europe who have been afraid to dismantle labor regulations that make it difficult for companies to hire and fire, or eliminate rules that favor certain interest groups. There are already clear signs of central bank retrenchment. Fed Chairman Ben S. Bernanke indicated last week that the American central bank was likely to wind down the purchases of bonds it has used to push down market interest rates.
The 17 European Union finance ministers in Luxembourg have attempted to establish a system meant to ensure that taxpayers never again have to pay so much for the mistakes of bankers.