Europe`s Two Priorities for the G20

In his Commentary published in the run-up to the G20 summit in Washington on 15 November 2008, CEPS Director Daniel Gros attributes the global financial crisis to two macroscopic failures: monetary policy should have reacted earlier to the boom in house prices and regulators should have forced banks to accumulate larger reserves for the tougher times that had to come sooner or later. He asserts that the root causes for these failures need to be understood properly before trying to create a new Bretton Woods.