BRUSSELS, Aug 20: The European Trade Union Confederation (ETUC) on Monday called on the European Commission to act decisively to help end the current “financial crisis”, accusing Brussels of “monumental complacency.”

“It has taken a crisis to awaken policy makers to the dangers involved in the recent stupendous growth of hedge funds and derivative markets,” the Brussels-based confederation, which represents trade unions from 36 European nations, said in a statement.

Trade union warnings on the risks of hedge fund operations and “how no one can be sure about who is responsible for what, or what the true liabilities are in today’s casino economy... fell on deaf ears” the ETUC said.

The confederation singled out the EU’s Internal Market Commissioner Charlie McCreevy for special blame, accusing him of “monumental complacency”.

However, the group praised the European Central bank for its swift intervention in the markets to avoid a full-blown credit crunch.

The ECB has poured more than 200 billion euros into the jittery market, to stem the crisis provoked in the US subprime home loan sector, far more than it used to calm nerves in the aftermath of the Sept 11, 2001 attacks on the US.

“Europe, and the world, has been caught out by the speculators,” ETUC Secretary General John Monks said.

“We have allowed them to exercise a huge influence on the world economy...

But they have become more interested in gambling on shaky deals. How many more risks like the sub-prime mortgages are undervalued? What is the real extent of liabilities of hedge funds and of the banks?” The European Commission and other institutions need to find out the answers quickly, “if confidence is to return swiftly and long-term damage averted,” he warned.

The trade unions federation called on the EU’s executive arm to investigate the role played by credit rating agencies, bank involvement in hedge funds and credit markets, the lack of transparency in the derivative markets and “the lack of effective regulation”.

Last Thursday, the European Commission said it would investigate how credit ratings agencies operate, amid growing concern over their slow response to the US subprime mortgage crisis which has sent markets tumbling worldwide.

French Finance Minister Christine Lagarde said on Monday that the worst of the US mortgage crisis was over, as Europe’s main stock markets recovered further, lifted by a strong rebound for Asian equity prices following the recent global sell-off caused by the US housing crisis.—AFP