And, crucially, the ECB could be given the power to step in to inspect the financial soundness of any particular bank or subset of banks outside of the systemic group but which are flashing red on its radar. A small supervisory SWAT team could be sent in to kick the tires alongside the national supervisor that retains direct supervisory responsibility.
The world economy has expanded, per capita incomes have risen, inflation has settled to historically low levels, and the financial markets have been marked by abundant liquidity, low interest rates and limited asset-price volatility.