Merkel Says ‘I Told You So,’ Europe Set To Act

Sep 22 2008 | 9:54am ET

The worldwide market turmoil has one world leader saying, “I told you so.”

German Chancellor Angela Merkel blasted the American and British governments for blocking her efforts to increase controls on worldwide financial markets, especially hedge funds.

“It was said for a long time, ‘Let the markets take care of themselves,’ and that there is ‘no need for more transparency,’” Merkel said at an election rally in Linz, Austria, for that country’s main conservative party. “Today we are a step further because even America and Britain are saying, ‘Yes, we need more transparency, we need better standards for the ratings agencies.’”

The U.S. and Britain stymied Merkel’s efforts to impose worldwide regulation or monitoring of hedge funds during Germany’s presidency of the G8 last year.

Meanwhile, another group of European politicians are working to make Merkel’s dream a reality.

The European Parliament is set to approve legislation that would increase transparency at hedge funds and private equity firms today. In addition to new transparency rules, the proposals would cover manager qualifications, conflicts of interest, hedge fund registration and disclosure of ownership structures.

The legislation has long been championed by Europe’s socialist parties, including the British Labour Party, and has recently won increasing support from the continent’s more free-market-friendly Christian Democrats and liberal parties.

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