It was a banking crisis, in late 2011, that almost
destroyed the eurozone - and would have done, if the European Central Bank
hadn't weighed in with unprecedentedly cheap loans to struggling banks and a
pledge to do "whatever it takes" to keep the monetary-union show on the
road.
But the ECB's succour represented short-term emergency treatment, not the
kind of long-term reforms that would succeed in breaking the vicious connection
between bloated weak banks and individual sovereign states lacking the resources
to bail out those weak banks.
Which is why the stakes were so high for the so-called "banking union" being
created to accompany "monetary union" and - in particular - the creation of what
is known as a "Single Resolution Mechanism", intended to minimise the collateral
damage from bank failures.
A successful resolution system has to achieve two things when a bank gets
into difficulties, if the damage to all our wealth is to be minimised - there
needs to be speedy action to maintain the really essential functions of the
bank, and the financial costs of propping up the good bits of the bank and
quarantining the bad need to fall as little as possible on taxpayers.
So after all the fraught negotiation to create the Single Resolution
Mechanism, will it meet those two criteria - or is it a traditional eurozone
plate of fudge and mudge, a breakfast concoction fit primarily for canine
consumption.
I shall let you to be the judge of that.
3 comments:
So very little has been achieved to reassure the creditors of Spain and Italy, for example, that the resources have been created to rehabilitate their over-stretched banking systems without putting an excessive burden on their respective public finances.
That said, steps have been taken to reduce the burden on the taxpayers of member states - by forcing losses, via a new Bank Resolution and Recovery Directive, on banks' most well-heeled creditors (holders of bank bonds and those with deposits that exceed 100,000 euros).
And there will be a new pan-eurozone resolution fund, created by a levy on individual eurozone banks.
But here is what made me chuckle. After 10 years, by 2026, that fund will contain in its coffers 55bn euros.
Does that sound like a lot of money to you? Well it's a pimple in the context of the monumentally huge balance sheets of eurozone banks.
That said, steps have been taken to reduce the burden on the taxpayers of member states - by forcing losses, via a new Bank Resolution and Recovery Directive, on banks' most well-heeled creditors (holders of bank bonds and those with deposits that exceed 100,000 euros).
And there will be a new pan-eurozone resolution fund, created by a levy on individual eurozone banks.
But here is what made me chuckle. After 10 years, by 2026, that fund will contain in its coffers 55bn euros.
Does that sound like a lot of money to you? Well it's a pimple in the context of the monumentally huge balance sheets of eurozone banks.
Here is one way of seeing how little it is.
It is considerably less than the British government spent on propping up one bank, Royal Bank of Scotland.
And it is exactly the same, $75bn, as the US Federal Reserve is still spending every single month on bond purchases, even after last night's historic announcement of tapering, the decision by the Fed to reduce the scale of those bond purchases by $10bn per month.
Or to put it another way, Germany's insistence that nothing should be agreed that could prevent any future German government insulating German taxpayers from the costs of rescuing feckless banks in other parts of the eurozone have resulted in a resolution system whose credibility is - well - questionable.
Potrivit unor cifre oferite de organizaţia filantropică Broadway, specializată în ajutarea oamenilor străzii, în Londra erau 1.672 de persoane fără adăpost în octombrie 2013. Dintre acestea, 13 erau imigranţi bulgari, iar 157 imigranţi români, reprezentând aproximativ 10 la sută din numărul total al persoanelor fără adăpost.
Britanicii reprezintă 47 la sută dintre persoanele fără adăpost de pe străzile Londrei, al doilea grup ca mărime fiind cel al românilor.
Daily Mail a publicat aceste date pe fondul polemicilor referitoare la imigraţie. Marea Britanie ar urma să elimine de la 1 ianuarie restricţiile pe piaţa muncii impuse cetăţenilor români şi bulgari, iar premierul David Cameron a propus, pe fondul polemicilor, limitarea accesului la indemnizaţiile sociale.
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