(Updates with Stark quotes in the second paragraph.)
Oct. 17 (Bloomberg) -- European Central Bank Executive Board member Juergen Stark said euro states will need to “transfer” some control of their economies to prevent another crisis.
“We need a genuine economic union to go ahead with real political union,” Stark told European lawmakers in Brussels. “That means to give up national sovereignty over macroeconomic objectives.”
Stark, who resigned last month in protest over purchases of government bonds by the ECB, also told the parliamentarians that common bonds issued by euro nations will not solve the crisis. Stark said today he expects to stay in office until the end of the year.
Europe’s policy makers are under pressure to find a solution to a crisis that has raged for two years, brought Greece to the brink of default and is now threatening to tip the global economy into recession. The ECB has shouldered the main burden of keeping Europe’s banks afloat by flooding the system with liquidity and making some asset purchases.
“Do not be mistaken that there is an alternative silver bullet that will resolve the current crisis and prevent future ones, such as the issuing of euro bonds,” Stark said. “More Europe is the solution, and not less Europe.”
--With assistance from Jonathan Stearns in Brussels. Editor: James Hertling, Leon Mangasarian.
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