A “Major Concern”
The European Banking Authority EBA, which (we guess) is fighting for its survival after the ECB has become the sole supervisor of Europe’s “systemically relevant” banks, has recently issued a comprehensive report on the European banking system (this included the unintended revelation that its employees have yet to master the intricacies of Exel).
As an aside, we have little doubt that this bureaucracy will survive. Has there ever been a case of an EU bureaucracy not surviving and thriving? We don’t recall one off the cuff, but perhaps we are mistaken. We’re sure some reason will be found to preserve this particular zombie sinecure as well.
Hey guys! We’re still issuing reports! See how important it is to keep us well-funded?
A Sharp Turn in Swedish Politics
When we recently discussed Europe’s refugee crisis, we mentioned that a sizable political backlash was to be expected and that unfortunately, extreme nationalist parties were likely to be among the main beneficiaries. We also mentioned the situation of Sweden, where the mainstream political parties in an ongoing fit of political correctness bordering on lunacy have apparently decided to transform Sweden into a province of Mesopotamia.
Leader of the nationalist Sweden Democrats, Jimmie Akesson
Photo credit: Frankie Fouganthin / CC
The Walking Dead
Now that Europe’s fractionally reserved banking system has been regulated into complete inertia, it is a good time to assess the current bottom line, so to speak. We should mention here that there are essentially two ways of dealing with the banking system. One is to introduce an unhampered free market banking system based on strong property rights and nothing else. Such a system would work best if it were based on sound money, i.e., a market-chosen medium of exchange. The regulations governing such a system would fit on a napkin.
Image credit: Warner Bros, processing fmh
Never let a Crisis go to Waste
As is well known, the EU’s socialist centralizers and “harmonizers” have always fully expected the adoption of the euro to lead to a crisis that would allow them to push through policies that would otherwise never have seen the light of day. Italian socialist and former EU Commission president (i.e., chief commissar) Romano Prodi told the Financial Times in 2001:
“I am sure the euro will oblige us to introduce a new set of economic policy instruments. It is politically impossible to propose that now. But some day there will be a crisis and new instruments will be created.”
Montgolfière – engraving by Claude-Louis Desrais, 1783
Greece is Still Lying in Wait …
We haven’t written much about Greece recently, but there have actually been a few developments worth paying attention to. Several easily foreseeable things have indeed happened in the meantime: Prime minister Tsipras felt forced to call a snap election after securing the first bailout tranche, the radical Marxist faction of Syriza led by Panaghiotis Lafazanis has split from the party, and so has its “youth wing”. In the meantime, the Greek economy has predictably nosedived as a result of the banking system freeze (Mish reports the grisly details here).
The Gift that Likely Will Keep Giving …
Jay Taylor has mailed us an infographic he and his colleagues at Boston University and Pearson Education have put together, entitled “Why the Euro Zone Crisis is not Over”. We have decided to reproduce it here, as it provides a good overview of the most important data points surrounding the still festering crisis situation.
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