TEXT OF INTERVIEW
JEREMY HOBSON: Now, let’s turn to the debt crisis in Europe which continues to unfold. The European Central Bank chief said today the bank will continue to provide cash as needed to keep the financial system there going.
Let’s bring in our regular Thursday contributor. Diane Swonk is chief economist at Mezirow Financial and a regional adviser to the Fed. She’s with us live from Chicago. Good morning.
DIANE SWONK: Good morning.
HOBSON: Yesterday we heard that it’s getting more expensive for supposedly strong countries like Germany and Belgium to borrow money. Is this crisis getting worse?
SWONK: For the moment it is getting worse before it’s going to get better because there’s a lot of uncertainty about how much it’s actually going to cost and how far down the really at-risk economies like Ireland and Greece are actually going to have to fall before they bottom out.
HOBSON: Is this something that American’s should be worried about? Is this something that can affect us here?
SWONK: Absolutely, I mean during the financial crisis the Federal Reserve released yesterday the banks that they helped out during the height of the financial crisis to keep the global financial system going. Of the ten top banks, eight of them were European banks.
HOBSON: Eight of them were European banks. So we actually do play a roll in what goes on over there?
SWONK: Not only do we play a roll, it’s a little bit insulting that the Finance Minister of Germany had the audacity to call Ben Bernanke “clueless” on administering QE2 when we’re the one who saved their banks.
HOBSON: QE2 the quantitative easing version two, Diane Swonk, chief economist at Mezirow Financial, thanks for joining us.
SWONK: Thank you.
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