By Suzanne Cosgrove

CHICAGO (MNI) – European Central Bank President Jean-Claude Trichet
Tuesday said that it was “out of the question” that a European Nation
should default, but refused to answer questions regarding the current
debt crisis in Greece, noting that negotiations still are in progress.

Speaking at a morning event at The Chicago Council on Global
Affairs here titles “Lessons from the Financial and Economic Crisis,”
Trichet said central bankers faced exceptional challenges during the
crisis, and were “exposed to things that were not in the textbooks.”

Trichet added that he believes a depression would have occurred
without “creative” action. Taxpayers will profit from some bailout
measures, and lose from others, he said.

The ECB was relatively upbeat about the current state of the
economy. Europe is “back to a state of recovery” after the recession, he
said, but still has a number of difficult issues to solve.

“Confidence,” Trichet said, is a primary ingredient in a recovery.

Regarding the topic of the “lessons” from the crisis, Trichet said
it was evidence that we are truly bound in a global economy, and that
G-20 nations must have the same accounting and other financial rules,
Trichet said. “We want to be sure that we do not repeat” a situation
where there are big imbalances, he added.

In a question and answer session with former Chicago Federal
Reserve President Michael Moskow, Trichet added that nations must be
permanently alert for indications of inflation, and said the anchoring
of inflation expectations has been “quite correct.” Current interest
rates also appear to be at appropriate levels, he stated.


** Market News International Chicago Bureau: 708-784-1849 **

[TOPICS: M$$DR$,MMUFI$,M$U$$$,MT$$$$,M$$FX$,M$$EC$,M$X$$$,M$$CR$,MGX$$$]