… will they? This week Brussels plans that European Banks are the ones to finance the European Fonds for instable countries. The security fond EFSF already keeps some bn750$ – European tax payers money.
Europe’s future still dismal?
The European Financial Stability Facility (EFSF) is designed to bolster economy of European countries in “difficult situations”. That “difficult situations” may arise soon is one of the leading opinions among German bank managers. Me, being optimistic as usual, was quite surprised hearing that in the ZDF 2pm news. “Every second German bank manager counts on at least one European country to fail within 2011”. This is also the message of this news article which based its information on a poll made among managers.
However, one measurement to avoid this scenario to happen is the EFSF. By now its filled up with tax payers money but soon its the banks who will step in for failing countries.
How bank levy works:
Banks life through good in bad times. According to Brussels they will hand in a certain amount of money, say 100million Euro each year. In case of 500 million earnings thats 20% and should already hurt pretty much. In case a bank even is in the red for one year, they shall pay 100 plus the 100 from the former year plus interst say 210 million.
Bottom line: Bank levy is very significant cut into banks budget. Now somebody could state: “Yeah the bank..you know, they got all the cash dude. Let’em motherf*ckers pay”
This opinion seems tolerable at first glance. But lets think a step further. Who’s money is it in the end? Tax payers money – our money! So another rise in banking fees will be inevitable. Thanks Brussels.
However, we do not have to fear Germany’y economy to fear. Though we at Bravenewfinance outlined that it is still possible that some European countries may fail.
Preventing that from happening should be in all our interest although paying for speculators greed, consumer’s irresponsive spending behaviour, reason for Lehman to crash in the first place, is still bugging us.
We can do nothing about it so let’s take it easy:
Surfing thruogh the web, I tried to get the opinion on bank levy from first hand such as managers. How they feel about it, and that financing is more than just higher fees for customers is explained best in the following pictures:
Insinuating that Chancelor Merkel and Germany’s finance Minister Schäuble are one of the key “instigators” of bank levy.
Another one taking a sarcastic approach:
Hypo Real Estate (HRE) is one of Germany’s most massive money eaters after the crisis. Its rescue cost tax payers more than Euro 100bn, as this article outlines. Still in the red this bank won’t be able to pay bank levy for years. Financing this levy with the EFSF would be an insane circle.
In the end, we can do nothing about it. Can we?
Maybe you can find additional opinions or pictures on this topic. Looking forward to reading your opinion.