Banking Union with a Sovereign Virus. The self-serving regulatory treatment of sovereign debt in the euro area. CEPS Policy Brief No. 289, 27 March 2013

In many eurozone countries, domestic banks often hold more than 20% of domestic public debt, which is an unsatisfactory situation given that banks are highly leveraged and that sovereign debt is inherently subject to default risk within the euro area. This paper by Daniel Gros finds, however, that the relative concentration of public debt on bank balance sheets is not just a result of the euro crisis, for there are strong additional incentives for banks in some countries to increase their sovereign. His contribution discusses a number of these regulatory incentives – the most important of which is specific to the euro area – and explores ways in which euro area banks can be weaned from massive investments in government bonds.

Human naïve regulatory T-cells feature high steady-state turnover and are maintained by IL-7

Naïve FoxP3-expressing regulatory T-cells (Tregs) are essential to control immune responses via continuous replenishment of the activated-Treg pool with thymus-committed suppressor cells. The mechanisms underlying naïve-Treg maintenance throughout life in face of the age-associated thymic involution remain unclear. We found that in adults thymectomized early in infancy the naïve-Treg pool is remarkably well preserved, in contrast to conventional naïve CD4 T-cells. Naïve-Tregs featured high levels of cycling and pro-survival markers, even in healthy individuals, and contrasted with other circulating naïve/memory CD4 T-cell subsets in terms of their strong γc-cytokine-dependent signaling, particularly in response to IL-7. Accordingly, ex-vivo stimulation of naïve-Tregs with IL-7 induced robust cytokine-dependent signaling, Bcl-2 expression, and phosphatidylinositol 3-kinase (PI3K)-dependent proliferation, whilst preserving naïve phenotype and suppressive capacity. Altogether, our data strongly implicate IL-7 in the thymus-independent long-term survival of functional naïve-Tregs, and highlight the potential of targeting the IL-7 pathway to modulate Tregs in different clinical settings.

The Dutch wish-list for a lighter regulatory touch from the EU. CEPS Commentary, 1 July 2013

The Dutch government set out the results of its review of EU competences on June 21st, under the slogan “European where necessary, national where possible”, claiming that the EU does not adequately respect the principles of subsidiarity and proportionality. It published a list of 54 points for corrective action, which Michael Emerson assesses in this new CEPS Commentary. The political significance of this initiative is heightened because it comes alongside the UK's ongoing review of EU competences, although unlike the British, the Dutch make no mention of secession, treaty changes or repatriation of competences.