In a speech yesterday, in Stockholm Sweden, Vice Chairman of the Federal Reserve and former governor of the Bank of Israel and former chief economist at the World Bank, Stanley Fisher noted:
“As part of this approach, the United States is preparing a proposal to require systemically important banks to issue bail-inable long-term debt that will enable insolvent banks to recapitalize themselves in resolution without calling on government funding–this cushion is known as a “gone concern” buffer.”
Mr. Fisher gave no details as to whom in the United States was preparing the bail-in proposal and what “bailinable long term debt” is.
It Happened in Cyprus, But Can It Happen Here?
In spring of 2013 the failing European Bank of Cyprus performed a bail-in that required depositors to help save the bank by foregoing a large portion of the money they had deposited in the bank. In return for their forebearance, depositors were given equity shares in the failing bank.
Customers who deposit money in banks are lending that money to the bank. Depositors are in effect, unsecured creditors. If the bank fails, depositors get in line with other unsecured creditors to see how many cents on the dollar, if any, they can retrieve.
In the United States to offset this result, the Federal Deposit Insurance Corporation (FDIC) since 1933 insures bank deposits up to $250,000*. THe FDIC, however, is woefully underfunded to handle payouts in the event of a large bank failure. The new proposal is designed to allow failing banks to get back on their feet “without calling on government funding.”
Under the proposed bail-in scenario, the faiure of a “sytematically important bank” (a.k.a. “too big to fail”) will receive no government funding to stay afloat. In order to keep their casino doors open, a too big to fail bank will just call on their loyal depositors to help out by taking whatever percentage of the depositors’ money they need to stabilize the bank.
After $4 trillion of quantitative easing by the Federal Reserve over the past five years, and record profits at the largest U.S. banks, it would seem that the U.S. banks should be sound and talk of bailing them in, unnecessary. Apparently, not as Mr. Fischer’s comments make clear.
With banks already paying close to zero interest on deposits and the real possibility that a depositor could actually lose money by keeping it in a too big to fail bank, what incentive do depositors have in keeping their cash in such banks?
*At the time of the Cypriot bail-in, EU depositor insurance was in place.
Source
Showing posts with label europe. Show all posts
Showing posts with label europe. Show all posts
Monday, February 4, 2019
Thursday, April 11, 2013
Patrick J. Buchanan on the holocaust
From Patrick J. Buchanan
Was the Holocaust Inevitable?
Friday - June 20, 2008 at 12:07 am
by Patrick J. Buchanan
“What Would Winston Do?”
So asks Newsweek’s cover, which features a full-length photo of the prime minister his people voted the greatest Briton of them all.
Quite a tribute, when one realizes Churchill’s career coincides with the collapse of the British empire and the fall of his nation from world pre-eminence to third-rate power.
That the Newsweek cover was sparked by my book “Churchill, Hitler and The Unnecessary War” seems apparent, as one of the three essays, by Christopher Hitchens, was a scathing review. Though in places complimentary, Hitchens charmingly concludes: This book “stinks.”
Understandable. No Brit can easily concede my central thesis: The Brits kicked away their empire. Through colossal blunders, Britain twice declared war on a Germany that had not attacked her and did not want war with her, fought for 10 bloody years and lost it all.
Unable to face the truth, Hitchens seeks solace in old myths.
We had to stop Prussian militarism in 1914, says Hitchens. “The Kaiser’s policy shows that Germany was looking for a chance for war all over the globe.”
Nonsense. If the Kaiser were looking for a war he would have found it. But in 1914, he had been in power for 25 years, was deep into middle age but had never fought a war nor seen a battle.
From Waterloo to World War I, Prussia fought three wars, all in one seven-year period, 1864 to 1871. Out of these wars, she acquired two duchies, Schleswig and Holstein, and two provinces, Alsace and Lorraine. By 1914, Germany had not fought a war in two generations.
Does that sound like a nation out to conquer the world?
As for the Kaiser’s bellicose support for the Boers, his igniting the Agadir crisis in 1905, his building of a great fleet, his seeking of colonies in Africa, he was only aping the British, whose approbation and friendship he desperately sought all his life and was ever denied.
In every crisis the Kaiser blundered into, including his foolish “blank cheque” to Austria after Serb assassins murdered the heir to the Austrian throne, the Kaiser backed down or was trying to back away when war erupted.
Even Churchill, who before 1914 was charging the Kaiser with seeking “the dominion of the world,” conceded, “History should … acquit William II of having plotted and planned the World War.”
What of World War II? Surely, it was necessary to declare war to stop Adolf Hitler from conquering the world and conducting the Holocaust.
Yet consider. Before Britain declared war on him, Hitler never demanded return of any lands lost at Versailles to the West. Northern Schleswig had gone to Denmark in 1919, Eupen and Malmedy had gone to Belgium, Alsace and Lorraine to France.
Why did Hitler not demand these lands back? Because he sought an alliance, or at least friendship, with Great Britain and knew any move on France would mean war with Britain — a war he never wanted.
If Hitler were out to conquer the world, why did he not build a great fleet? Why did he not demand the French fleet when France surrendered? Germany had to give up its High Seas Fleet in 1918.
Why did he build his own Maginot Line, the Western Wall, in the Rhineland, if he meant all along to invade France?
If he wanted war with the West, why did he offer peace after Poland and offer to end the war, again, after Dunkirk?
That Hitler was a rabid anti-Semite is undeniable. “Mein Kampf” is saturated in anti-Semitism. The Nuremberg Laws confirm it. But for the six years before Britain declared war, there was no Holocaust, and for two years after the war began, there was no Holocaust.
Not until midwinter 1942 was the Wannsee Conference held, where the Final Solution was on the table.
That conference was not convened until Hitler had been halted in Russia, was at war with America and sensed doom was inevitable. Then the trains began to roll.
And why did Hitler invade Russia? This writer quotes Hitler 10 times as saying that only by knocking out Russia could he convince Britain it could not win and must end the war.
Hitchens mocks this view, invoking the Hitler-madman theory.
“Could we have a better definition of derangement and megalomania than the case of a dictator who overrules his own generals and invades Russia in wintertime … ?”
Christopher, Hitler invaded Russia on June 22.
The Holocaust was not a cause of the war, but a consequence of the war. No war, no Holocaust.
Britain went to war with Germany to save Poland. She did not save Poland. She did lose the empire. And Josef Stalin, whose victims outnumbered those of Hitler 1,000 to one as of September 1939, and who joined Hitler in the rape of Poland, wound up with all of Poland, and all the Christian nations from the Urals to the Elbe.
The British Empire fought, bled and died, and made Eastern and Central Europe safe for Stalinism. No wonder Winston Churchill was so melancholy in old age. No wonder Christopher rails against the book. As T.S. Eliot observed, “Mankind cannot bear much reality.”
Source:click here
Was the Holocaust Inevitable?
Friday - June 20, 2008 at 12:07 am
by Patrick J. Buchanan
“What Would Winston Do?”
So asks Newsweek’s cover, which features a full-length photo of the prime minister his people voted the greatest Briton of them all.
Quite a tribute, when one realizes Churchill’s career coincides with the collapse of the British empire and the fall of his nation from world pre-eminence to third-rate power.
That the Newsweek cover was sparked by my book “Churchill, Hitler and The Unnecessary War” seems apparent, as one of the three essays, by Christopher Hitchens, was a scathing review. Though in places complimentary, Hitchens charmingly concludes: This book “stinks.”
Understandable. No Brit can easily concede my central thesis: The Brits kicked away their empire. Through colossal blunders, Britain twice declared war on a Germany that had not attacked her and did not want war with her, fought for 10 bloody years and lost it all.
Unable to face the truth, Hitchens seeks solace in old myths.
We had to stop Prussian militarism in 1914, says Hitchens. “The Kaiser’s policy shows that Germany was looking for a chance for war all over the globe.”
Nonsense. If the Kaiser were looking for a war he would have found it. But in 1914, he had been in power for 25 years, was deep into middle age but had never fought a war nor seen a battle.
From Waterloo to World War I, Prussia fought three wars, all in one seven-year period, 1864 to 1871. Out of these wars, she acquired two duchies, Schleswig and Holstein, and two provinces, Alsace and Lorraine. By 1914, Germany had not fought a war in two generations.
Does that sound like a nation out to conquer the world?
As for the Kaiser’s bellicose support for the Boers, his igniting the Agadir crisis in 1905, his building of a great fleet, his seeking of colonies in Africa, he was only aping the British, whose approbation and friendship he desperately sought all his life and was ever denied.
In every crisis the Kaiser blundered into, including his foolish “blank cheque” to Austria after Serb assassins murdered the heir to the Austrian throne, the Kaiser backed down or was trying to back away when war erupted.
Even Churchill, who before 1914 was charging the Kaiser with seeking “the dominion of the world,” conceded, “History should … acquit William II of having plotted and planned the World War.”
What of World War II? Surely, it was necessary to declare war to stop Adolf Hitler from conquering the world and conducting the Holocaust.
Yet consider. Before Britain declared war on him, Hitler never demanded return of any lands lost at Versailles to the West. Northern Schleswig had gone to Denmark in 1919, Eupen and Malmedy had gone to Belgium, Alsace and Lorraine to France.
Why did Hitler not demand these lands back? Because he sought an alliance, or at least friendship, with Great Britain and knew any move on France would mean war with Britain — a war he never wanted.
If Hitler were out to conquer the world, why did he not build a great fleet? Why did he not demand the French fleet when France surrendered? Germany had to give up its High Seas Fleet in 1918.
Why did he build his own Maginot Line, the Western Wall, in the Rhineland, if he meant all along to invade France?
If he wanted war with the West, why did he offer peace after Poland and offer to end the war, again, after Dunkirk?
That Hitler was a rabid anti-Semite is undeniable. “Mein Kampf” is saturated in anti-Semitism. The Nuremberg Laws confirm it. But for the six years before Britain declared war, there was no Holocaust, and for two years after the war began, there was no Holocaust.
Not until midwinter 1942 was the Wannsee Conference held, where the Final Solution was on the table.
That conference was not convened until Hitler had been halted in Russia, was at war with America and sensed doom was inevitable. Then the trains began to roll.
And why did Hitler invade Russia? This writer quotes Hitler 10 times as saying that only by knocking out Russia could he convince Britain it could not win and must end the war.
Hitchens mocks this view, invoking the Hitler-madman theory.
“Could we have a better definition of derangement and megalomania than the case of a dictator who overrules his own generals and invades Russia in wintertime … ?”
Christopher, Hitler invaded Russia on June 22.
The Holocaust was not a cause of the war, but a consequence of the war. No war, no Holocaust.
Britain went to war with Germany to save Poland. She did not save Poland. She did lose the empire. And Josef Stalin, whose victims outnumbered those of Hitler 1,000 to one as of September 1939, and who joined Hitler in the rape of Poland, wound up with all of Poland, and all the Christian nations from the Urals to the Elbe.
The British Empire fought, bled and died, and made Eastern and Central Europe safe for Stalinism. No wonder Winston Churchill was so melancholy in old age. No wonder Christopher rails against the book. As T.S. Eliot observed, “Mankind cannot bear much reality.”
Source:click here
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