Stiglitz says debt-equity swaps can rectify the financial system

The US government's measures to restore financial order are costly and wrong, according to a Nobel laureate in economics, US economist Stiglitz, 18th, and should take the form of debt swaps to rectify the financial system. In the French echo, Stiglitz said the US measures to overhaul the financial system (injecting money into banks) were too costly and problematic to compensate those who created the current economic mess.　　He argued that the transfer of debt to equity was a viable option. He said debt-to-equity swaps could re-establish confidence in the banking system and stimulate loan consumption without harming taxpayers ' interests. "The holders of fixed-rate bonds don't like the way debt swaps are, and they prefer to get a big gift from the government," he said.　　He argues, however, that government money has many other uses, such as the introduction of new economic stimulus measures. In mid-April, Stiglitz pointed out that the US government's bank bailout plan is likely to fail because it plans to help Wall Street rather than create a viable financial system. He argues that the US government's tarp is not enough to recapitalise the banking system, that there is a conflict of interest within the White House, and that some of Mr Obama's advisers are closely linked to Wall Street. (Lu Long Jun)