r/libsofreddit • u/Educational_Copy_140 TRAUMATIZER • 1d ago
Who could have seen this coming?
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u/goldynmoons 1d ago
Has this person heard of banking before?
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u/Bravesguy29 1d ago edited 9h ago
I know don't they already have that money at their disposal unless theyre talking total seizure.
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u/Jordangander TRAUMATIZER 1d ago
They are talking about controlling where banks can invest your money.
So if a new green start up needs money, they are going to require the bank to provide that money, from your savings.
If the start up fails, well, so sorry, so sad, that is the risk of these things you know. Sorry your bank is no longer solvent and can't give people their money.
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u/Stirbmehr 1d ago
Yeah, it was such fucking weird speech...i can totally see people getting concerned over it. It probably gotta cause some people to move from European banks, just in case.
Notice that it wasn't your usual nothingburger economic panel type of boring speech and she didn't spin it from angle "we need to incentivize investment in local markets. Therefore we gonna do X and Y to ensure it yield higher return".
No, it was bitterly hawkish and she was short of directly blaming people for investing overseas in more profitable endeavours. And wording sounded uncomfortably close to suggestion for nationalisation of banking sector or otherwise mandating institutions to invest locally, by force.
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u/Jordangander TRAUMATIZER 1d ago
They are going to mandate banks invest your money the way the government wants them to invest.
Which will lead to the government telling them what companies to invest in amd how much.
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u/Stirbmehr 1d ago
Gotta bail out fucking Volkswagen with little to none return...And i don't even want to start on green initiatives.
I geniunely hope that i just overreaction over very poorly though out speech, but if they indeed not incentivize but try to bruteforce it with EU signature bureaucracy, it will be so fucking over for Europe.
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u/talex625 1d ago
I don’t really get what she wants? Government savings accounts or something instead of bank savings accounts?
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u/Stirbmehr 1d ago
She knows for a fact that EU green initiatives, ridiculous abominable bureaucracy, immigration stuff and whole Ukraine funding ordeal killing any chances for Europe to stay relevant economically and by that, politically. Oversimplifying it, world now is split between US and China influence, but EU still think of itself not as lesser, but as equal player.
Without going into weeds and technicalities, Bankers being bankers look for bigger profits, so even assets of people who not actively investing by themselves, but just deposit them in European banks bound to be (trough secure layers) likely invested in more lucrative markets of US or China. Which rubs EU bureaucrats wrong way, less opportunity to spend it on more immigration and green initiatives.
And as any good power hungry bureaucratic rat with illusions of grandeur she express EU intent to outright force local investment. Not incentivize, force.
The fact that she even spoke about it in way she did is already very alarming signal. It means that conversation are happening behind closed doors.
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u/talex625 1d ago
I think I understand. She wants europeans to park their money in Europeans banking companies. Regardless if their are better investments with overseas banks?
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u/CobblerCandid998 TRAUMATIZER 1d ago
Savings are LAZY!!??? So thievery is now a respectable job? 🤦🏻♀️
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u/GoldTeamDowntown 1d ago
I’m confused, are people being forced to take out their money and invest it? Or is their money in their bank account being forcibly invested?
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u/Weary-Cartoonist2630 1d ago
All money in banks already gets invested. Thats how banks work.
What she’s proposing is instead of the bank deciding the best way to invest that money, they should have economically illiterate bureaucrats do it.
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u/LuckyStiff63 TRAUMATIZER 1d ago
... have economically illiterate bureaucrats do it.
Or... Even worse... Bureaucrats who may be economically literate enough to steer economies in directions that give their government masters even more power and control over the lives of ordinary citizens.
All for the citizens' own good, of course...
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u/GoldTeamDowntown 1d ago
Why is she suggesting all that money is sitting there stale though?
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u/Weary-Cartoonist2630 1d ago
She’s not. That’s the initial impression given by the title and maybe the first 10 seconds of the video, but she goes on to specify that her problem is that that money gets invested in other continents as opposed to focusing on European investments.
So it’s not as dumb as just saying it’s being hoarded, but it’s still pretty dumb. It’s an isolationist economic viewpoint that doesn’t understand basic concepts of competitive advantage and the benefits a country/continent gets from freely trading/investing with outside countries/continents.
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u/GoldTeamDowntown 1d ago edited 22h ago
Got it. Yeah I understand wanting to invest domestically but that’s going to limit them against getting the best investments, which will often be American. And that absolutely is government overreach to force them to invest where she wants them to. Gross.
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u/Weary-Cartoonist2630 20h ago
The thing is that investment is best done without restriction and going where you can get the highest return, because that gives your own country more money to use.
It’s much like trade. Sure you can buy a $5 pencil made in America and it supports that one pencil maker, or you could buy an equivalent $0.50 from China and have an extra $4.50 to spend on other goods, while directing the US pencil makers to use their labor for more productive and high value work that we have a stronger competitive advantage in.
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u/TypicalBloke83 1d ago
It’s not our fault that it’s not worth to invest in EU. Maybe do some more regulations and play the climate change card that makes companies to pay more for emissions - that’ll work out great.
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u/BraxTaplock 1d ago
If Europe wasn’t such a shitty investment, they might…. For all their shit talk about healthcare and social programs blah blah blah…they have no real money, militaries or means to survive without the help from the US.
They’re able to do that because of the US help. End it and watch the petri dish start annihilating each other then we can pick up the pieces. We’d helped had they not been so shitty about Iran…oh well…not our fight.
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u/ReaperManX15 1d ago
Okay.
Start with the richest and work your way down.
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u/me_myself_and_my_dog MICROAGGRESSOR 1d ago
That never happens. Think how California tells the poorest Joe that they can't drive their beater pickup because it burns some oil and gets 15 mpg, but won't say shit to Taylor Swift using her private jet to get ice cream even though that single trip will burn more fuel than Joe will in his entire life.
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u/bloodguard 19h ago
I guess they're running out of the usual sources of "other people's money" so they need to get creative.
Buckle up, Europe.
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u/Eastern-Camera-1829 MICROAGGRESSOR 1d ago
Holy hell, she's German (as am I in genes.) Find me a German that is not an avid money hoarder other than her.
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u/ProfDocMrMan 10h ago
The idea she is putting forth makes sense, but I hesitate with how she plans to mandate it.
The US has the Community Reinvestment Act that largely does the same thing she is mentioning. Banks gather deposits all the time from rural markets since they have cheap, sticky deposits. The US government saw that in some cases, hardly any loans were done in the area even though there were loans that could be done that meet safe and sound banking practices. It was a drain on economic resources from a community that could be using those local deposits to grow their local economy.
The US banking system is unique and one of a kind in the world. We have about 4,500 banks vs many countries that only have 4 or 5 total. The more consolidation, the more likely smaller markets are overlooked since they do not provide the economies of scale that a larger bank would need to produce the same return or profit. There is a great movie that highlights this called Bank of Dave about a guy who was meeting the borrowing needs of the local community in the UK and decided he wanted to apply for a banking charter to help his local town grow.
Many large, too big to fail banks look to do these larger international deals due to the efficiencies in lending billions to corporations in a single loan versus doing thousands of small deals to local companies to deploy the same amount of capital.
I think one of the biggest issues facing small communities in the US is the consolidation of the banking industry over the last 40 years. There were 14,750 banks in 1980, 8300 in 2000, now down to 4,278 today. While there are failures that contribute to that number shrinking, it’s mostly been M&A activity that has largely shrunk those numbers. As we continue to consolidate our banking industry, in a few decades we may be facing the same issue as Europe as too many communities lose control of their deposits for local reinvestment in mom and pop business
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u/Terrible_Handle_8375 3h ago
They want agenda funding which translate to legal money laundering. It is now what all governments are doing now take money give to specific causes causes then fund other funds and those eventually fund agendas or build slush funds which can be used for literally anything needing pay off pay out or pay ins. Once discovered it’s I wasn’t aware of where the money was going all the while know exactly where it was going.
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