Europe Economy

Joint Euro Bonds Needed to Solve Crisis: Economist

Joint euro bonds are needed to solve the euro zone debt crisis, Societe Generale’s head of research, Patrick Legland, told CNBC Thursday.

European Central Bank
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Legland said he agreed with billionaire investor George Soros, who on Thursday called for a common European treasury.

“If in Europe we have a treasury market, it will reduce our cost of financing, it will ease pressure on the states, and it will help us put in place the right reforms,” Legland said.

Comparing Europe with the USA, Legland said that while both regions were burdened by debt, the USA had an advantage through its ability to raise funds via the bond markets.

“At least in the US, they have a very low cost of financing, because of this liquidity,” the research head said.

Legland added that Europe’s debt crisis needed to be tackled imminently to prevent a double-dip recession .

“If things are not addressed properly, it will increasingly have an impact on growth, and it will have an impact on liquidity. Fear factor will keep on rising, and we will head into a European recession,” the researcher said.