The confiscation of depositor funds
The real story for taxpayers and depositors is the heightened threat to their pocketbooks of a deal that now authorizes both bailouts and “bail-ins”
The Unsettled Question of Deposit Insurance;
But at least, you may say, it’s only the uninsured deposits that are at risk (those over €100,000—about $137,000). Right?
According to ABC News, “Thursday’s result is a compromise that differs from the original banking union idea put forward in 2012. The original proposals had a third pillar, Europe-wide deposit insurance. But that idea has stalled.”
Two pillars are now in place” – two but not the third.
And two are not enough to protect the public.
As observed in The Economist in June 2013, without Europe-wide deposit insurance, the banking union is a failure…
“As things stand, the banks are the permanent government of the country, whichever party is in power.”
– Lord Skidelsky, House of Lords, UK Parliament, 31 March 2011)
On March 20, 2014, European Union officials reached an historic agreement to create a single agency to handle failing banks. Media attention has focused on the agreement involving the single resolution mechanism (SRM), a uniform system for closing failed banks. But the real story for taxpayers and depositors is the heightened threat to their pocketbooks of a deal that now authorizes both bailouts and “bail-ins” – the confiscation of depositor funds. The deal involves multiple concessions to different countries and may be illegal under the rules of the EU Parliament; but it is being rushed through to lock taxpayer and depositor liability into place before the dire state of Eurozone banks is exposed.
View original post 1,601 more words