zerohedge | At first we thought Reuters had been punk'd in its article titled "EU executive sees personal savings used to plug long-term financing gap"
which disclosed the latest leaked proposal by the European Commission,
but after several hours without a retraction, we realized that the story
is sadly true. Sadly, because everything that we warned about in "There May Be Only Painful Ways Out Of The Crisis"
back in September of 2011, and everything that the depositors and
citizens of Cyprus had to live through, seems on the verge of going
continental. In a nutshell, and in Reuters' own words, "the
savings of the European Union's 500 million citizens could be used to
fund long-term investments to boost the economy and help plug the gap
left by banks since the financial crisis, an EU document says."
What is left unsaid is that the "usage" will be on a purely involuntary
basis, at the discretion of the "union", and can thus best be described
as confiscation.
The source of this stunner is a document seen be Reuters, which
describes how the EU is looking for ways to "wean" the 28-country bloc
from its heavy reliance on bank financing and find other means of
funding small companies, infrastructure projects and other investment.
So as Europe finally admits that the ECB has failed to unclog its broken
monetary pipelines for the past five years - something we highlight
every month (most recently in No Waking From Draghi's Monetary Nightmare: Eurozone Credit Creation Tumbles To New All Time Low),
the commissions report finally admits that "the economic and financial
crisis has impaired the ability of the financial sector to channel funds
to the real economy, in particular long-term investment."
The solution? "The Commission will ask the bloc's insurance watchdog
in the second half of this year for advice on a possible draft law "to mobilize more personal pension savings for long-term financing", the document said."
Mobilize, once again, is a more palatable word than, say, confiscate.
And yet this is precisely what Europe is contemplating:
Banks have complained they are hindered from lending to the economy by post-crisis rules forcing them to hold much larger safety cushions of capital and liquidity.
The document said the "appropriateness" of the EU capital and liquidity rules for long-term financing will be reviewed over the next two years, a process likely to be scrutinized in the United States and elsewhere to head off any risk of EU banks gaining an unfair advantage.
But wait: there's more!
Inspired by the recently introduced "no risk, guaranteed return"
collectivized savings instrument in the US better known as MyRA, Europe
will also complete a study by the end of this year on the feasibility
of introducing an EU savings account, open to individuals whose funds
could be pooled and invested in small companies.
Because when corporations refuse to invest money in Capex, who will
invest? Why you, dear Europeans. Whether you like it or not.
But wait, there is still more!
Additionally, Europe is seeking to restore the primary reason why
Europe's banks are as insolvent as they are: securitizations, which the
persuasive salesmen and sexy saleswomen of Goldman et al sold to idiot
European bankers, who in turn invested the money or widows and orphans
only to see all of it disappear.
1 comments:
...you *DO* realize, of course, the fundamental underlying cause of banking problems is the wimpy sobbing liberal destructive pressures, beginning in the Clinton Administration, to equalize the outcomes for IQ-75 LOOZerz by giving them home loans violating traditional secure lending standards. These loans then packaged into worthless derivatives and sold to US and European banks creating today's financial house-of-cards.....(The Johnson Administration policies having paid said LOOZerz to go forth at taxpayer expense and OOW-breed themselves into a political force)...NOW, let the Wealth Re-Distribution shift into High Gear.....ROTFLMwAO....
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