Brussels Proposes “Guillotine” to Stabilise failing Banks
Eurozone bank depositors may face a threat to liquidity and even the loss of their deposits if Brussels enacts the “moratorium tool.”
Effectively depositors will “opt-in” to bank failures in Europe. Such a rule or even implied enactment will drive depositors from the weak banks in Euroland, weak being a category which encompasses most European banks today. Depositors do not share in banking profits – They should not be required to shoulder the losses.