Exact(25)
They never warned against the dangers of excessive private debt.
"By corruption, the early generations meant excessive private interests influencing the exercise of public power," Teachout writes.
Yanis Varoufakis is the former finance minister of Greece The 2008 crisis was caused by excessive private debt.
But the origins of the euro disaster lay less with government profligacy than with excessive private borrowing.
Osborne said the crisis was caused by excessive private and public debt, which had to be purged from the system before real recovery could take hold.
According to Fintan O'Toole, writing in the Irish Times, O'Brien "has accumulated excessive private power" with "an impact on the public realm of democracy".
Similar(35)
In both cases, the origins of the crisis lay in excessive private-sector optimism, with huge inflows of foreign lending going mainly to the private sector.
My view of Brown is that most of the mistakes he made were during his time as chancellor, when he mistook a boom built on excessive private-sector debt for genuine long-term growth.
Jeremy Stein, a professor at Harvard University and a nominee for governor of the Federal Reserve, says excessive private-money creation can leave the financial system too reliant on these forms of short-term debt and vulnerable to a shock.
Most euro-zone countries now agree on the need for stronger macroeconomic surveillance to avert future crises, going beyond public finances to address other risks like excessive private-sector borrowing, asset price bubbles and economic imbalances.
Understanding the risks of excessive private-sector borrowing, the inadequacy of private lenders' credit assessments, and the conflicts of interest that are endemic in banks, Sub-Saharan countries should impose constraints on such borrowing, especially when there are significant exchange-rate and maturity mismatches.
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Justyna Jupowicz-Kozak
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