European banks have asked the European Commission to postpone the introduction
of tougher global bank capital rules by a year to 2014 after U.S. regulators
told lenders they did not expect the new regulations to take effect in
2013......The feeble EU will almost certainly cave in. Europe is SO bust that it
needs the bankers, more than the bankers need the EU. This would show that the
EU is no more than a grubby little exercise (or project) to allow politicians to
borrow "however much it takes" to get as many European people "hooked for good"
on Europe's spend, spend, spend socialist politicians as possible. And, later
on, if US banks decided to play by less strict rules, then don't let them trade
in Europe? The new Basel rules are not that strict anyway. They are only
designed to try and make it a bit more difficult for banks to go bust when the
next crash happens. It tries to raise the cover provided for banks debts turning
bad from 2% to 7%. Meaning if more than 2% of the loan book goes bad now - the
bank goes bust. The authorities have plucked a 7% figure out of the air as being
sufficient cover for all future banking crises.
Access Investments-Building Awareness - European Union-ROMANIA
Saturday, November 24, 2012
The feeble EU will....
European banks have asked the European Commission to postpone the introduction
of tougher global bank capital rules by a year to 2014 after U.S. regulators
told lenders they did not expect the new regulations to take effect in
2013......The feeble EU will almost certainly cave in. Europe is SO bust that it
needs the bankers, more than the bankers need the EU. This would show that the
EU is no more than a grubby little exercise (or project) to allow politicians to
borrow "however much it takes" to get as many European people "hooked for good"
on Europe's spend, spend, spend socialist politicians as possible. And, later
on, if US banks decided to play by less strict rules, then don't let them trade
in Europe? The new Basel rules are not that strict anyway. They are only
designed to try and make it a bit more difficult for banks to go bust when the
next crash happens. It tries to raise the cover provided for banks debts turning
bad from 2% to 7%. Meaning if more than 2% of the loan book goes bad now - the
bank goes bust. The authorities have plucked a 7% figure out of the air as being
sufficient cover for all future banking crises.
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3 comments:
don't understand why Europe is make itself weak at such a time?
You cannot have an organisation of 28 states (2013) in each just 9 are net contributors on a long run , 2(Ireland , Belgium) from net recivers net contributors and all the others net receivers. Something is not working. And is not the member states is the mafia from Brussles
’s not that they don't have enough money to pay its more the principal - they have said they will not pay and are now being told by a US judge that they have to.
The implications for future defaults by any government are enormous, the Judge is effectively saying that governments cannot choose to default and still issue debt i.e. if you do default you cannot borrow from anyone else until the defaulted debt has been repaid.
This brings in the question of sovereignty i.e. can a US judge tell a foreign government what it can and can't do? you would think not, but much sovereign debt is issued under New York or European Law rather than that of the issuing country as investors would be less likely to lend to Argentina, for example, if the millions they lent were protected by Argentine law instead of the US legal system.....at the very least they would require a higher coupon in order to lend under local legal jurisdiction.
So Argentina is in a very difficult spot, if they refuse to pay they could trigger another default and make it even more difficult to borrow in future, or if they do pay, they will then be exposed to claims from the other "holdouts" who hold approx. and additional $12bn.
Meanwhile Merkel is taking on the role of intermediary between net contributors and the beneficiary countries. It seems unlikely, however, that net contributors will be able to push through cuts beyond those included in the Van Rompuy proposal. A compromise that comes to less than €1.01 trillion would have no chance of being passed by European Parliament, warned the body's President Schulz -- a warning that must be taken seriously given parliament's veto over budgetary matters
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