How do we think EU negotiations will go? (Vol 13)

[DeltonaS]

stongle said:

DeltonaS said:

Prudential stadards much higher ?

What a laugh, London (and the USA) caused a massive banking crisis in 2008 thanks to exactly this.

The UK/London has been the best in setting low prudential rules, pre-banking crisis London standards we're even lower than the US. London gave banks ample room to set up shadow banks through SIVs that could be kept out of the books causing an influx of securitized assets generated by for instance US investment banks that didn't receive so much lenaycy at home. The banking supervision in London pre-banking crisis was even paid for by the banks themselves. The bonusses in banking were the highest in the world, all incentives for taking risk.

So pre-banking crisis London did everything to accomodate and please bankers with low prudential rules and oversight and post banking crisis London suddenly has the highest standards ?

Again, what a laugh.

Yawn, expected that rant. Relevant pre-2007; no longer. The current EC approach to post crisis regulation is a nonsense and the EC are on record rolling back every single Capital and liquidity standard out there - agreed by the G20. Please, don't give me 13 year old of date nonsense. Lowest prudential standards globally = EU. Banks that should have been allowed to fail by own EC rules = EU (MDP). Broke own rules on regulation of trading CoCOs (DB) = ECB. Need I go on.

Stress testing of Italian Banks during the 2016 referendum found many would have been technically in default if held to same prudential standards as UK banks - and that was just intraday stress from the BREXIT vote. Give it a rest.

It is relevant.

First of all just like in Germany where the car industry is heavily backed, or a current example, Tirol, Austria where the tourism industry is heavily backed (Tirol tried to extent the holiday season despite the discovery of Covid in Ischgl) in England the banking industry is heavily backed. It's the cash cow, lot's of jobs are dependant on it, meaning local politics is pushed and pressured to be lenient. It's human nature.

Do you know who's been given the responability to enhance and restructure the oversight of EU banking; it's been given by the EU to a Brit. The European Banking Authority was (pre-Brexit) seated in London.

European banks have to adhere to the same capital requirements (depending on their size and complexity; G-SIB etc.), the same common rule book, as UK banks. Banks in Europe including the British ones are stress tested by the EBA. Yes, some banks in the EU were treated with some leniency, the stress test results of the individual banks were not always published But the underlying mechanism is the same. And it's well known the PIIGS nations are on average less well capatalized.

But it's more complicated than that. For instance the larger more complex banks in Europe (like RBS, HSBC, Unicredit, Credit Agricole, Santander, ING, ABN AMRO, Deutsche, Commerzbank etc.) who are (partly) allowed to calculate their own capital requirements based on own credit models ((advanced)Internal Rating Based Approach) manipulate their models, therby pretending to be better capatalized than they actually are.

So the reality is far from your narrative: UK vs. EU.

stongle said:

Its widely acknowledged that explicit banking regulation was at fault for the abuses running up to 2008; what did the EC do with ESMA - double down with MIFID2. It's a nonsense reg that only gives punched tape to ESMA. Of little practical use when many trades are bifurcated for accounting reasons. The UK regulatory regime has done a 180 and is built around outcome focused implicit rules. If done in Europe, severalT1 banks would be in deep do do.

Most of the banks you refer to using SPVs to structure balance sheet funding structures for US banks were European, using London structuring expertise. The head offices were ALL in the EU. The largest providers were DB, SG, BNP, Credit Ag, Dresdner, Commerz; UK banks were in the main Barclays and HSBC. And since the ECB went negative rates, where do you think a lot of that excess cash ended up? in UK banks, nope. Its funding the balance sheets of US banks on the cheap.

So you acknowledge that the UK regulatory regime and banking system was fundamental. Good.

stongle said:

I suggest you do some research on the continuing abuse of WHT (Withholding Tax Treaty) and facilitation by EU banks - continuing to reduce offshore NON-EEA tax liabilities and reduce revenues for tax authorities. There are over 20 European Banks still engaged in either outright reclaim or facilitation through pass through. Suggest you look on the news for the tax trial ongoing on Cologne where 2 traders from HVB bank (German) performed at EUR60bn tax rip on cum cum and cum EX dividends. Still going on.

In short, the ECBs efforts to grow EU inflation was paradoxical to post crisis regulatory change and systematic protection. The EC decided to game global systematic financial risk than face cold hard economic home truth...

So come again on the pious? Or do you have an axe to grind with the UK. Sounds like it...…

Oh and much of the Free Trade architecture within the EU was driven from German / UK cooperation. Since you are obviously a fan of history.

Or am I due a wikipedia warrior whoosh parrot?

Don't try to manipulate the storyline, I have no axe to grind with the UK, you post things on the internet with, as you acknowledged yourself, UK coulored glasses. I can also post anything and pretend it's true, facts backed with evidence is stronger.

But you seem to be a bit stuck in your nationalistic views.

Edited by DeltonaS on Saturday 28th March 21:17

[don'tbesilly]

Helicopter123 said:

jsf said:

DeepEnd said:

jsf said:

Remember people, self isolate, you know it makes sense.

I missed your bit about gleefully telling the EU to sod off, wouldn't want you to feel isolated from the others. On cloud 9.

Stop lying, your quoted my post so you didn't miss anything, apart from the meaning of the post, which is hardly news where you are concerned.

Doubling down?

That was timely, I hadn't received the new irony meter yet, or I would have needed to order a fourth

[Helicopter123]

DeltonaS said:

stongle said:

DeltonaS said:

Prudential stadards much higher ?

What a laugh, London (and the USA) caused a massive banking crisis in 2008 thanks to exactly this.

The UK/London has been the best in setting low prudential rules, pre-banking crisis London standards we're even lower than the US. London gave banks ample room to set up shadow banks through SIVs that could be kept out of the books causing an influx of securitized assets generated by for instance US investment banks that didn't receive so much lenaycy at home. The banking supervision in London pre-banking crisis was even paid for by the banks themselves. The bonusses in banking were the highest in the world, all incentives for taking risk.

So pre-banking crisis London did everything to accomodate and please bankers with low prudential rules and oversight and post banking crisis London suddenly has the highest standards ?

Again, what a laugh.

Yawn, expected that rant. Relevant pre-2007; no longer. The current EC approach to post crisis regulation is a nonsense and the EC are on record rolling back every single Capital and liquidity standard out there - agreed by the G20. Please, don't give me 13 year old of date nonsense. Lowest prudential standards globally = EU. Banks that should have been allowed to fail by own EC rules = EU (MDP). Broke own rules on regulation of trading CoCOs (DB) = ECB. Need I go on.

Stress testing of Italian Banks during the 2016 referendum found many would have been technically in default if held to same prudential standards as UK banks - and that was just intraday stress from the BREXIT vote. Give it a rest.

It is relevant.

First of all just like in Germany where the car industry is heavily backed, or a current example, Tirol, Austria where the tourism industry is heavily backed (Tirol tried to extent the holiday season despite the discovery of Covid in Ischgl) in England the banking industry is heavily backed. It's the cash cow, lot's of jobs are dependant on it, meaning local politics is pushed and pressured to be lenient.

Do you know who's been given the responability to enhance and restructure the oversight of EU banking; it was been given by the EU to a Brit. The European Banking Authority was (pre-Brexit) seated in London.

European banks have to adhere to the same capital requirements (depending on their size and complexity; G-SIB etc.), the same common rule book, as UK banks. Banks in Europe including the British ones are stress tested by the EBA. Yes, some banks in the EU were treated with some leniency, the stress test results of the banks were not always published individually But the underlying mechanism is the same. And it's well known the PIIGS nations on average are less well capatalized.

But it's more complex than that. For instance the larger more complex banks in Europe (like RBS, HSBC, Unicredit, Credit Agricole, Santander, ING, ABN AMRO, Deutsche, Commerzbank etc.) who are (partly) allowed to calculate their own capital requirements based on own credit models ((advanced)Internal Rating Based Approach) manipulate their models, therby pretending to be better capatalized than they actually are.

So the reality is far from your narrattive: UK vs. EU.

stongle said:

Its widely acknowledged that explicit banking regulation was at fault for the abuses running up to 2008; what did the EC do with ESMA - double down with MIFID2. It's a nonsense reg that only gives punched tape to ESMA. Of little practical use when many trades are bifurcated for accounting reasons. The UK regulatory regime has done a 180 and is built around outcome focused implicit rules. If done in Europe, severalT1 banks would be in deep do do.

Most of the banks you refer to using SPVs to structure balance sheet funding structures for US banks were European, using London structuring expertise. The head offices were ALL in the EU. The largest providers were DB, SG, BNP, Credit Ag, Dresdner, Commerz; UK banks were in the main Barclays and HSBC. And since the ECB went negative rates, where do you think a lot of that excess cash ended up? in UK banks, nope. Its funding the balance sheets of US banks on the cheap.

So you acknowledge that the UK regulatory regime and banking system was fundamental. Good.

stongle said:

I suggest you do some research on the continuing abuse of WHT (Withholding Tax Treaty) and facilitation by EU banks - continuing to reduce offshore NON-EEA tax liabilities and reduce revenues for tax authorities. There are over 20 European Banks still engaged in either outright reclaim or facilitation through pass through. Suggest you look on the news for the tax trial ongoing on Cologne where 2 traders from HVB bank (German) performed at EUR60bn tax rip on cum cum and cum EX dividends. Still going on.

In short, the ECBs efforts to grow EU inflation was paradoxical to post crisis regulatory change and systematic protection. The EC decided to game global systematic financial risk than face cold hard economic home truth...

So come again on the pious? Or do you have an axe to grind with the UK. Sounds like it...…

Oh and much of the Free Trade architecture within the EU was driven from German / UK cooperation. Since you are obviously a fan of history.

Or am I due a wikipedia warrior whoosh parrot?

Don't try to manipulate the storyline, I have no axe to grind with the UK, you post things on the internet with, as you acknowledged yourself, UK coulored glasses. I can also post anything and pretend it's true, facts backed with evidence is stronger.

But you seem to be a bit stuck in your nationalistic views.

Good Post.

Strongle is sometimes well informed, but his overtly nationalistic starting point frequently clouds his judgement and interpretation of the facts. To be fair, this is a common failing amongst large swathes of the pro-Brexit lobby, they can be overtly 'Britain First' in their outlook.

Edited by Helicopter123 on Saturday 28th March 20:13

[Helicopter123]

B'stard Child said:

Who suggested I was talking about you?

It always has to be about you doesn't it - you really are an attention seeking wassock

Your concern and empathy was fully revealed with regard to Nadine

Just out of interest, what is you think I said about Nadine?

[TriumphStag3.0V8]

Helicopter123 said:

Good Post.

Aaaaaaaannnnnd there it is. Didn't take long :-)

[anonymous-user]

TriumphStag3.0V8 said:

Helicopter123 said:

Good Post.

Aaaaaaaannnnnd there it is. Didn't take long :-)

[don'tbesilly]

Helicopter123 said:

B'stard Child said:

Who suggested I was talking about you?

It always has to be about you doesn't it - you really are an attention seeking wassock

Your concern and empathy was fully revealed with regard to Nadine

Just out of interest, what is you think I said about Nadine?

We know what you wrote (no need for thinking), it's still there because it was quoted by others, and it was missed by the mods when they deleted your original post because it was deemed as *offensive (*description by management)

[Murph7355]

DeepEnd said:

Heli was wrong to take delight in Nadine's plight, and you rightly castigated the doubling down.

Now the bully boys have been on cloud 9 about EU food supply issues, the shoe is on the other foot. And you didn't disappoint in your hypocrisy.

"We're bigger than 16 of the EU nations together". Now that was a good post ... no really, it speaks volumes.

wtf are you talking about?

Who's in raptures about EU food supply issues? Where have they been mentioned on this thread at all, let alone in any gleeful way?

You mention doubling down...is the quote you note incorrect? Has anyone said it's the only factor that matters/

[Murph7355]

DeepEnd said:

Telling "the EU to sod off" now are we chaps?

Sure, you "love Europe".....

My 4yr old is better able to read than you it seems.

Clue..."IF the EU want to play silly buggers....".

IF we did I'd expect them to do the same.

[Murph7355]

DeltonaS said:

...

Stange how some on here think the EU is too big, a federal state, while at the same time it's too small because the EU doesn't act and there's a lack of solidarity and collaboration when it comes to tackling problems.

...

There's no real contradiction here.

In many spheres plenty of us have noted that the EU is neither fish nor foul.

The political objectives of the EU politicos are well understood, but the EU electorates are not that interested by and large (referenda in the run up to Lisbon being pretty clear indicators along with our exiting). As a result it is in an odd grey area - it's transcended a pure trading bloc, with political interference and "competencies" (ironic)...but equally cannot move to being a full on supranational state (though it continues to try and in many areas pretend it is).

It needs to make its mind up - straddling a fence is rarely comfortable for anyone. The solutions, IMO, are to either wind right back or move forwards now at pace. I don't see either happening, which is bad for everyone.

[stongle]

DeltonaS said:

Don't try to manipulate the storyline, I have no axe to grind with the UK, you post things on the internet with, as you acknowledged yourself, UK coulored glasses. I can also post anything and pretend it's true, facts backed with evidence is stronger.

But you seem to be a bit stuck in your nationalistic views.

Edited by DeltonaS on Saturday 28th March 20:33

I'm not manipulating anything. Gaming regulatory resource requirements is endemic in ALL banks. HOWEVER. The EC wants to maintain a lower floor than the UK, US or other regimes for exactly the reasons I outlined earlier. Post crisis regulatory systemic response is paradoxical to the approach the ECB took to create eurozone inflation. That's a fact.

I've been deeply involved in EBA stress tests in the past, how do you think the banks got past them (despite 5% of EU zone banks failing the last lot). Risk on today, off tomorrow. I have zero axe to grind with EU bank entities, or Europeans - I do have an issue with self obsessed politicians and management teams that take the piss.

There were many regulatory failings in the UK in the run up to the global crisis; but in no way were we alone. Many of the leverage max fund of fund entities were structured in London, but incorporated in Luxembourg. It takes 2 to dance.

But we are dancing around the main issue. If you have an environment where the central bank has negative rates, and you cannot pass them on to depositors; the banks are fked and Net Interest Margin is in the toilet. If your banks go pop, you are fked as the on / off ramp of monetary policy is in the toilet.

The problem is a concoction of post crisis regulations and how we dealt with the crisis. Bank bail in, is a massive issue in the PIIGs, so large it creates a ripple out effect that requires Germany and the Netherlands to ask questions of how many Collie Green Linquinis they are willing to spend to back up monetary union. Banking union should be a thing, but negative rates have decimated the banks. I'm not taking a nationalist stance, but one of systematic integrity. Its the same view the ECB has.

ESMA is a joke. As an insider you must see this, as I suspect you are also in the Netherlands: conservative approach is not in line with the majority of other EU states. Loans are being made because the regulations say government debt is zero risk weighted BUT it is not. To play to your modelled argument. Germany and the Netherlands are clear on this.

You have acknowledged the risks here, its a sliding scale of how large we think those risks are. I think the risks (and contagion are large).

From a thread perspective, the optimum outcome is a deal on FS. The level of post Corona debt is massive, it needs buyers. the UK is better placed for global buyers than the EU. A sensible approach to equivalence better than 30 days would yield massive results for the EU AND the negotiations. Barnier has to learn to lose a battle to win a war.

[Big Al.]

Continued over here:-

https://www.pistonheads.com/gassing/topic.asp?h=0&...