The second issue is that of transaction financing. Improving it would require the development of repo markets. Repo markets are a key instrument for banks to trade cash while controlling counterparty risks. A well-functioning repo market is also a precondition for feasible market-making by dealers, and would increase two-way trading in both equity and bond markets.
With the benefit of hindsight the decision taken in 1995 by the US Administration is now widely praised, as will be the case in a few years – I believe – for the European decision to support Greece.