YouSaid · the spoken record

Mario Draghi

lines on the record: 31
first: 2017-09-18
most recent: 2017-09-18
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“Well, I think the key and the most obvious thing is to work with the major European countries and France in particular, but also Italy and Spain on figuring out a smooth way to manage Brexit. That is a huge, huge challenge for the next few years. And as I said, Germany has a lot more to lose than to gain by the departure of the UK, so managing that process is challenge number one. The next big thing, and that will work in parallel, is deepening of the European Union, particularly where it relates to, for us what's very relevant is the whole banking system and how deeper integration of the banking system can add stability to the European growth process and add funding and financing and lending to the European growth process.”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“No reason why they can't get on a MOOC. In school, you can do MOOC, exactly. And it's brilliant. I mean, MOOC has a lot of massive online courses. I mean, it has a huge amount of potential globally, but specifically targeting this...”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“pass or increment the formal education system with online courses and online methods of reaching students that are not necessarily benefiting from the public sector education. I mean one of the things which Germany is working on but not there yet is just the period of time where asylum seekers spend in the administrative process of being recognized or not recognized takes months if not years.”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“Germany demographically has only one hope, namely immigration. If you look at the demographics of Germany, they're quite unhealthy purely on a domestic basis. So Germany actually for many decades has relied on immigration to keep our demographic balance in a positive way. Overall, I would say the immigration that we've had from Europe, from Southern Europe, from Eastern Europe, from Central Europe, and now more recently from the Middle East and Africa has the potential to have a positive impact. The key question is, of course, and that is the much more challenging issue with the current number of immigrants, is to educate and to integrate those immigrants into the labor market and the education market. And the aspect that Kiran has is absolutely fascinating, namely saying we will buy”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“really knows this interesting question exactly but you know the one of my favorite quotes from our energy commodities analyst Jeff Curry is never underestimate the power of combining large pools of capital with ingenuity in engineering that was his point where he very very intelligently predicted the growth of the shale industry in the United States And I would say that German automakers have at least the same potential to become very, very credible and very good players in electric cars because those two factors, capital and engineering ingenuity really exist in Germany. So in that sense, I would be optimistic that the German car makers actually find a way to compete in this market as well.”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“I guess the question is similar to the one we have here. Can the legacy automakers really invent the car of the future or is that going to come from Silicon Valley and California-based car companies that are really starting afresh? No one really knows exactly.”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“Let's talk a little bit about the automotive sector. The industry is obviously one of the most fascinating industries today when you think about the transformation of technology and how consumer preferences are changing. A lot of the big automakers were just in Frankfurt and they unveiled their visions for the future and their next models. Investors seem cautious. Shares of German car makers have been declining this year, while the benchmark DAX is up. What are the reasons for that and do you think the automakers can find their way forward from here?”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“Of credit for that. Of course, now the consensus in Germany is that probably the course of dovish monetary policy in general and the systematic purchases of government bonds in particular has probably gone too far. And very likely that whole debate will resolve itself quite clearly, not by a decision that is being made, but simply because the bonds that the ECB can buy will soon run out.”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“Well, first of all, with all the negativism that is prevalent in Germany about the debate around the ECB, think there is a broad consensus that we owe a huge amount of gratitude to Mario Draghi for taking decisive moves in 2012 when truly Europe was reeling towards the brink. And if you put yourself back into the time before Mario Draghi gave his now famous will do whatever it takes speech, Had that continued we don't know what would have happened the consequences could have been quite dire, especially in the real economies in Italy, Spain and peripheral Europe. So I think point A is he did stabilize the system in a massive way in a format that really was very, very efficient because at the end of the day his credibility was so strong that he actually didn't have to implement the measures that he announced. Markets just believed him, right? So in that sense stage one I would say he deserves a huge amount of”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“The ECB has continued a pretty dovish approach to its assets purchasing program at interest rates, of course. And in Germany, that's gotten a lot of criticism for the impact it's had on savers, Germany being a big saving country. Give our audience a sense of where that debate stands today and what investors in Germany and Europe expect from the ECB going forward.”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“Germany can't freely lend the excess cash that it has to corporates in Italy. That would be just like a Californian bank not being able to lend to corporates in Nevada, which at some point in the US existed. These statewide bank regulations existed, but there was a good reason for the U.S. to abolish them, and it's made the U.S. bank market a very big uniform market, which Europe isn't. So I think European banks are still suffering from some of the inefficiencies of that.”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“First of all, of course, the interest rate environment overall is not necessarily favorable to banks generating earnings, as we know for many decades. Low interest rate environments are those where banks struggle the most. And in Europe, of course, we've had almost a decade-long close to zero rate environment now. So in that sense, ultra-low, exactly. So that does make the operating environment for banks difficult. And the other aspect that is peculiar to Europe versus the US, of course, is the fragmentation of banks and the difficulty to really do a cross-border business. Banks are one of the few industries in Europe where there is no real freedom of movement. For example, a bank that has more deposits than loans in”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“Let's talk about the financial sector, the banking sector in Europe responded to a difficult period by raising significant capital, somewhat later than the United States, but there's been a lot raised. There's still some concern about the long-term trajectory of banks in the EU. Do you see anything in the near medium term that gives you a sense that we're moving towards a healthier environment in the banking sector?”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“In a lot of ways, absolutely so, yes, and the regulatory regimes both for banks and insurance companies with the Basel process and Solvency II really has achieved the goal of increasing financial stability, increasing the capitalization of banks, increasing transparency, incentivizing trading behavior that is more on transparent venues than on over-the-counter venues. So I think a lot of what was defined at the G20 summit 2009 in Pittsburgh has actually been implemented, as always with these big movements, the pendulum always swings a bit further than probably was intended initially, and now a lot of the things that we're dealing with are discussions with regulators about unintended consequences. For example, one of the biggest topics that I discuss with clients”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“In the regulatory environment more broadly, market makers like Goldman face a somewhat complicated regulatory regime in the United States and Europe in the wake of the financial crisis for a lot of good reasons. Has that changed client activity and do you see any real traction behind the effort to harmonize regulation across Europe and America? Is that getting any traction today?”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“It's not top of mind, certainly, in the broad discussions. I mean, in the debate between Merkel and Schultz, the only televised debate didn't really come up as a topic. So in that sense, you see that it's more of a topic that the experts understand and the experts want to move forward.”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“It's the only solution that could resolve the earnings problems that the European financial sector has. We definitely need a deeper integration and we need more diversification of sources of funding for the corporate sector, which can actually benefit the banking system and the economy as a whole. And the economy as a whole, exactly to broaden the base, as we saw in many countries, the bank lending channel works well when the sun shines, but when crises come, you see the bank lending contract quite sharply. We saw that in Spain. We saw that in Italy. We saw that in Greece, and many of the countries that were afflicted by the crisis. And it really deepened the crisis quite substantially that there was no real alternative existing. So the concept of capital markets union, while it's not top of the list on the popular agenda in the election campaigns, neither in France nor in Germany.”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“One reform that got a lot of attention before the Brexit vote, at least in the financial sector and some extent in the corporate sector was the prospect of a capital markets union. The idea being that European economy is a little too dependent on bank lending and that there should be more as there is in the United States, more dynamic ability to finance middle market and even larger corporates through the capital markets. Where does that debate stand? Is the potential once we get through the election that we'll see some more activity on that?”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“Well, hopefully positively. I mean, if you look at European history, the biggest advances have always been made when Germany and France have been on the same page of agreement and deepening and made strides forwards, whether it's Schmidt-Giska or Helmut Kohl-Mitterrand, even though the leaders may have been in different camps politically speaking, the fact that they agreed on the fundamental of integration and deepening of Europe has really been the game changer then when the big reforms or the big steps towards deeper integration came. So in that sense, I think there is reason to be optimistic now that France has a”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“Right. Well, now that you mentioned that with the election of Macron in France and presuming the election in Germany goes as the pollsters predict, two of Europe's most advanced countries and largest economies will be led by pro-European leaders. How might that impact discussions around financial and market reform in the EU?”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“Of course, the shock in Germany was very, very tangible after the Brexit result came. Speaking with friends and clients after the Brexit election, everyone was shocked at the fact that a country like the United Kingdom could make such a decision. The fear overweighed the hope because of course the consensus of pro-European integration is very, very strong and losing the United Kingdom as a partner in building deepening of Europe is a very negative hit. And so in that sense, I would say the consensus in Germany is not necessarily saying, wow, this is great, fantastic, because we can attract more financial industry to Frankfurt, the consensus in Germany is more we've lost a very important European ally who's decided to go it on their own. Fortunately, I think that's the good news, is that the initial fear that there would”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“On Brexit, we don't seem that much closer to any real certainty, but there's one certainty, which is that Germany will take on a larger role in European markets once the UK has left. I'd be curious to hear your take first as someone who runs our German operations where we're liable to be a little bit bigger than we have in the past, and then as a business person who will obviously have to continue working with clients on both sides of the English channel.”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“There is a lot of positive attitude towards the German Chinese economic relationship. Germany exports a huge number of cars, machines into China. So in that sense, I think it's just the other side of the metal that, of course, just like German companies invest in Chinese companies in order to facilitate penetrating the Chinese market better. I think it's quite natural that Chinese companies also have an interest in expanding in Germany. a priori there is nothing negative about it of course it's always a question of due diligence every transaction and making sure that the buyer really has long-term interest but overall the initial negative reaction that was sometimes there in the public has moderated quite a lot”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“One place where we're seeing some capital inflows is there's a lot of interest from Asian buyers, particularly Chinese buyers in the German Middelstand and some of the family-owned businesses there that have really been the sort of bedrock of German industry over the years. That as it has in other countries, occasioned a little bit of a public debate around the wisdom of letting domestic assets fall into the hands of foreign investors, where does that debate stand today and how are German business people and politicians reacting to that interest by Asian buyers and good German companies?”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“Germany that is seen as something that we have to do something about. And one of the initiatives that the current coalition government had is to increase domestic demand, for example, by introducing minimum wages for the low income segment, by working on a project or a series of projects to increase public investment in education, in infrastructure such as roads and things that will basically boost domestic demand. Also we have a substantial increase in activity in the housing sector going on in Germany at the moment. So in that sense there is a lot of attention on promoting domestic demand as well to remediate the negative impacts from being too dependent on the external economy.”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“First of all, of course, it's a free market, and the fact that more consumers are buying German goods abroad and more corporates are buying machines from Germany is a positive sign to the industry that it's quite competitive. And President Donald Trump raised a lot of attention when he did an interview right after becoming elected, where he said that there's a lot of Mercedes driving on Fifth Avenue, but that in parallel he'd like to see more Chevrolets driving around in Germany, which is probably not going to happen at least not in equal amount. But it is an issue in Germany that is being taken quite seriously because, of course, the benefit of a large current account surplus when the economy is doing well is reflected in much deeper problems or crises when the global economy is not doing well. So Germany does tend to be very, very cyclical, and I do think that it”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“Germany has the largest current account balance in the world at close to $300 billion. That's been touted domestically as a sign of strength, but some trading partners, notably the United States, have criticized that surplus as somehow artificially boosting German industry and hurting others' countries' ability to export. What's your take on that issue from a German perspective?”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“The expectation is towards steady state and according to the pollsters who, as we know, have been quite wrong in the past, but just believing the pollster is the only question is who will Merkel govern with and it's just a question of does she continue the current grand coalition with the Social Democrats or does she opt for something a bit more unconventional, namely a coalition with the Free Democrats and very likely the Greens?”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“Given the stability and longevity of the miracle regime, are investors looking for anything particular this election, just the coalition partner she might bring on board, or are they expecting pretty much steady state in terms of policy?”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“Certainly, the characterization of the election as boring has its merits, the amount of consensus that the major parties have in Germany is very, very large, which I actually consider as something good. If I see the elections that we've had in France or Italy with some very, very large electoral votes going to xenophobic parties, anti-European parties, I actually have to say I'm quite happy living in a country where the consensus is deeper European integration. No one's talking about leaving the Eurozone. There's overall a very positive welcome culture towards immigration. So in that sense, having a broad consensus in those directions, I would say is positive and it does give a lot of stability, which investors, of course, find as something good.”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT
“So we're approaching an election in Germany that some commentators have cast as a little boring, especially relative to some of the recent elections in Europe. But a boring election brings with it some stability, which is no doubt welcome to some of investors. How would you characterize the state of the German market environment today as we approach this election?”
2017-09-18 · Goldman Sachs Exchanges · Europe Looks to Germany · IDENTIFIED FROM THE TRANSCRIPT