Monday 1 June 2009

Should banks be more regulated?

In my opinion they should. Since the beginning of the financial crisis Governments, in many countries, have put a lot of money to save banks from bankruptcy and taxpayers will have to pay to cover the debts.
We have been told that banks cannot go bankrupt because it would cause the collapse of the whole financial system because banks have shares in other banks, pension funds have shares in banks too, and the failure of one institution would mean losses for some others too.
So, if the State must intervene to avoid the catastrophe, why should not the whole bank sector be under more strict regulation in the first place?
if the State garantee the deposits, and it is right to do, then there must be rules and limits for the banks to not jeopardize people's savings.

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