European Central Bank President Trichet Warns EU Budget Slackers

European Central Bank President Jean-Claude Trichet issued a warning to EU member nations Monday, telling them that there will be penalties for countries that fail to follow the financial guidelines defined by the EU. Those penalties could include the loss of voting rights.

Trichet wants to strengthen the rules of the EU after the financial difficulties of the past few months. This spring, the growing awareness of Greece's soaring budget deficit and national debt led investors to flee the eurozone as suspicion fell on other member nations, including Spain and Portugal.

The rapidly deteriorating budgets and outlooks in the weaker member states led to the creation of a eurozone rescue package worth $929 billion. The next step in stabilizing the EU is new regulations, including penalties, aimed at preventing future crises.

The European Central Bank, headquartered in Frankfurt, Germany, is one of the most powerful governmental agencies in the world. It is the central bank charged with managing the euro, the monetary unit of the European Union. The bank was established in 1998, in preparation for the introduction of the euro a year later. The bank's mission is price stability in the eurozone.
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