Comments on: EU bank levy idea is circular — and dangerous http://blogs.reuters.com/breakingviews/2011/01/12/eu-bank-levy-idea-is-circular-and-dangerous/ Sun, 28 Apr 2013 15:49:48 +0000 hourly 1 http://wordpress.org/?v=3.4.2 By: pedrodude http://blogs.reuters.com/breakingviews/2011/01/12/eu-bank-levy-idea-is-circular-and-dangerous/comment-page-1/#comment-5841 pedrodude Thu, 13 Jan 2011 14:24:18 +0000 http://blogs.reuters.com/columns/?p=5091#comment-5841 And how exactly is the EU going to accurately predict the benefit from the one or two occasions when it would prove a lifesaver, compared to the detrimental effect on lending and spending by not drawing that liquidity away from the market? And won't this put a burden on successful banks and prop up unsuccessful member states [and indirectly, their banks]. At least without a safety net, banks and member states will be more inclined towards a less risky stance. And how exactly is the EU going to accurately predict the benefit from the one or two occasions when it would prove a lifesaver, compared to the detrimental effect on lending and spending by not drawing that liquidity away from the market? And won’t this put a burden on successful banks and prop up unsuccessful member states [and indirectly, their banks].

At least without a safety net, banks and member states will be more inclined towards a less risky stance.

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