The second observation is that the euro can be expected to have a significant influence on the structure of the financial system by bringing about more securitisation. A traditional feature of the financial system of continental Europe has been a marked dependency on the funds intermediated by banks. This feature contrasts with the financial system of the United States, which is much more securitised.
Outbreak of the turmoil 1 As you are well aware, in July and early August a series of events led to an intensification of the tensions in the US sub-prime mortgage market and a sharp decline in the degree of risk appetite of global investors. Market volatility increased across almost all financial asset classes.