tag:blogger.com,1999:blog-36227136.post1230314714841531078..comments2024-01-16T08:40:53.682+00:00Comments on <a href="http://www.openeurope.org.uk">Open Europe</a>: Exclusive: Internal docs give first look at EU plans to regulate 'shadow banking'OEhttp://www.blogger.com/profile/00556463374230498875noreply@blogger.comBlogger7125tag:blogger.com,1999:blog-36227136.post-781998638701089512013-09-02T11:35:46.452+01:002013-09-02T11:35:46.452+01:00Unelected political failures interfering and getti...Unelected political failures interfering and getting it wrong yet again. The eussr can never be effective because the constitution and the myriad of unelected bodies gets in the way of progress. Time to dismantle the whole corrupt democratically deficient body.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-36227136.post-52891355548538685802013-05-24T16:41:42.529+01:002013-05-24T16:41:42.529+01:00As the EU increasingly and disproportionately regu...As the EU increasingly and disproportionately regulates the UK's banks and their functions, banks will just not lend, leading to zero growth.<br /><br />Under EMIR (European Market Infrastructure Regulation - read the EU's Dodd-Frank Act for OTC derivatives), OTC derivative volumes will dive off of a cliff because the EU do not want anyone using them. Investors will be taking on basis risk and will also not be able to hedge out bonafide risks.<br /><br />My point is that entities and investors with risk capital are entering the shadow banking world where banks have stepped out (due to punitive regulation and cost). It is only shadow banks that will lend in certain areas and we risk, much like the FTT, doing more harm than good - AGAIN.<br /><br />I would sooner trust a monkey with a pin than the EU.<br /><br />In fact, the monkey would get a mandate from the UK's people and the EU wouldn't. Says it all.<br /><br />Referendum and OUT. UKIP.<br /><br />SCAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-36227136.post-39982348943037033512013-05-11T12:52:59.982+01:002013-05-11T12:52:59.982+01:00A story about shadow banks in Ireland:
http://www....A story about shadow banks in Ireland:<br />http://www.irishtimes.com/business/sectors/financial-services/no-desks-no-staff-no-tax-ireland-s-shadow-banks-1.1388923?page=1<br /><br />And an online search for the below search terms might be enlightening: Whistleblower Ireland Uncredit Jespernoreply@blogger.comtag:blogger.com,1999:blog-36227136.post-77091079018890833172013-05-08T14:24:03.645+01:002013-05-08T14:24:03.645+01:00@Rik,
the speed limit analogy is a good one, I mi...@Rik,<br /><br />the speed limit analogy is a good one, I might extend it a bit:<br /><br />The people who run banks would not see a speed limit of 50mph as a maximum nor as an order to drive 50mph. What they'd do is to drive at 60mph. They'd do that by first tampering with the speedometer of their car so that it showed a lower speed than what they were actually driving at. If ever stopped, they'd ague that the police measuring equipment isn't statistically proven to be sufficiently correct and drag out for as long as possible. In addition they'd hire any police who'd be brave enough to stop them. If their speeding where to be a factor in an accident they'd accept no blame, they'd put it on everybody else.<br /><br />Banks and shadow banks are to be treated as dangerous and therefore heavily regulated. The 'I didn't know/understand' excuse is not to be applicable in dangerous industries. Leverage to the minimum, control to the maximum and if a bank or a shadow bank fails then make the board of directors accountable.Jespernoreply@blogger.comtag:blogger.com,1999:blog-36227136.post-51832730338323784962013-05-07T09:09:39.633+01:002013-05-07T09:09:39.633+01:00@Jesper
They are indeed highly skilled and qualifi...@Jesper<br />They are indeed highly skilled and qualified people, well at least their uncles Mikos, Juan and Paolo told me so.<br /><br />Like with tax, after legislation is in place people more clever than the ones who drafted it (often assisted by the ones who drafted it) and all with the benefit of hindsight, will look where the gaps are and exploit them.<br />If you want these control systems to work you need therefor to do a lot of things different.<br /><br />In a nutshell being able (legally allowed, with sufficient powers to be effective and even better skilled than the highly qualified people from the EU) to react when a problem could occur.<br /><br />We are talking about a sector that is essential for the whole economy and where the idea for leverage is the equivalent of thinking that a 50 miles sign means you have to go 50 miles an hour and not max 50 miles an hour. Riknoreply@blogger.comtag:blogger.com,1999:blog-36227136.post-34525186544201594912013-05-06T19:35:14.091+01:002013-05-06T19:35:14.091+01:00I think it must be Spot the begged Question Week o...I think it must be Spot the begged Question Week once more.<br /><br />It doesn't really matter what you think of shadow banking or what "concerns" you have. Is the body that has made such a hash of the European economy and the euro really the right one to regulate a whelk stall?jon liveseynoreply@blogger.comtag:blogger.com,1999:blog-36227136.post-52945972873795758362013-05-06T12:25:03.780+01:002013-05-06T12:25:03.780+01:00It is being said that EU institutions are filled w...It is being said that EU institutions are filled with highly qualified people but when I read their output it seems like it has been written by undergraduates without work-experience...<br /><br />A (capital?) buffer of 3% to cover fluctuations? Is that the same as saying that a leverage of 33 is ok?<br /><br />Sorry, but this bit is plain wrong:<br />"All that said, it does provide a valuable service in many cases, particularly as an alternative method for distributing credit to the real economy when the banking sector is failing to do so sufficiently."<br />The shadow banking sector does not distribute credit to the real economy. That is what banks do, so either they are banks or they are not.<br /><br />The shadow banking is problematic and the problem is highlighted by the incomplete description of the shadow banking sector. The report includes what the shadow banking sector finances but not who finances it.<br /><br />Using a MMF can keep huge amounts guaranteed: A MMF dedicated to one customer can in theory and in practice spread out deposits across all euro-zone banks - suppose there is 600 banks in the euro-zone and multiply that number by the guaranteed amount of 100,000 EUR. That will give a protected amount of 60,000,000 EUR (60 million EUR, would be quite a large monthly payroll...). Good thing is that liquidity will spread, bad thing is that as there is a guarantee it means that the pressure to do due diligence is reduced. Regulators aren't enforcing much in some jurisdictions, if the market doesn't impose much discipline either then banks won't have to do much better than they have been doing in the last couple of years...<br /><br />Record low interest rates have made it less attractive to use the shadow banking sector, however, the Cypriotic haircut has made it more attractive to use the shadow-banking sector. On balance it might possibly be a wash.<br /><br />Want to actually deal with the shadow banking sector? Treat them as banks and force them to have at least the same size capital buffer as banks are legally required to have.Jespernoreply@blogger.com