Friday, November 14, 2014

The Vineyard of the Saker: The European Central Bank – ECB – invented yet another tool to hold Europe hostage vis-à-vis Russia

by Peter Koenig

The ECB has just launched – effective 4 November 2014 – a new watchdog to control and regulate the European banking system. It is called the Single Supervisory Mechanism – SSM. It is supposed to monitor and reign in European banks that do not ‘behave’ in terms of overstretching their investment and risk lending as compared to their capital base.

In fact, the SSM is one pillar of the three pillar ‘security’ system put in place by the ECB and the European Commission – EC.

The Single Resolution Mechanism – SRM – is ECB’s strong arm to save or liquidate ‘troubled’ banks. In other words, it will administer ‘bail-ins’ to ‘too-big-to-fail’ banks in distress; meaning – over-indebted banks will rescue themselves from depositors’ money, or from shareholders. This practice was tested in Cyprus in 2013. As reported by Reuters on 30 July 2013 – According to Cyprus's central bank, “47.5 percent of deposits exceeding 100,000 euros in Bank of Cyprus would be converted into equity to recapitalize the troubled lender as part of an international financial bailout for the island”.

This confiscating or stealing of depositors’ funds, also called the ‘haircut’ in the denigrating jargon of the Occident, is better known as a ‘bail-in’ – since it avoids the taxpayer, those who have been bearing the brunt in previous US and European ‘bail-outs’.

This atrocious predatory and outright criminal imposition by the infamous troika (ECB, EC, IMF), with no legal backing whatsoever, went largely without protests in the rest of Europe, it was shortly thereafter accepted by the EC as the new ‘norm’.

In one of his last proud statements before handing his job as European Commissioner to Jean-Claude Juncker, Manuel Barroso exclaimed – “The European Union intends to break the vicious link between sovereigns and their banks. In the future bankers’ losses should no longer become the people’s debt, putting into doubt the financial stability of whole countries.”

Complete story at - The Vineyard of the Saker: The European Central Bank – ECB – invented yet another tool to hold Europe hostage vis-à-vis RussiaCc Tattered EU flag 008

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