Time to put Basel III where it belongs…..#ecb #banks #spiral #stagnation #unemployment
European banks urge one-year delay for Basel III rules | Reuters.
Loan (Photo credit: Philip Taylor PT)
Basel III is the classic, ‘shutting the stable door after the horse has bolted’
Whilst banks are moronically told to build up their capital bases for the next potential Armageddon, the economy goes into stagnation overdrive. Without bank lending small companies can’t expand and will eventually die, base rates will stay at zero, no money is created from savings wealth and savers will not spend for fear of eroding their capital base.
What is the likelihood of the next Armageddon, nobody saw the last one and it was painfully obvious to all but the regulators.
What is needed is better regulation (not the same as more regulation), common sense lending and higher interest rates. Without these the economy will be stuck in a rut for decades to come.
Related articles
- European banks urge one-year delay for Basel III rules (scooprocket.com)
- Capital shortages, Basel III, and credit crunches (economist.com)
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