world

Yesterday I noticed two particular headlines standing out in the financial news. The oldest, which was actually from tuesday, read that the European Central Bank was again injecting money into the financial markets. The other one was that home confiscations in the US were way up.

I think the ECB is sending a very bad message to financial institutions here, not by intervening in the market in the first place, but by continuing to provide shelter after a couple of weeks: “act however irresponsibly that you wish to, we'll help you out if you get into trouble anyway.”

While they bear a large part of the responsibility by financing the US mortgage crisis in the first place, big institutions will get out largely unharmed in the long run. At the same time real persons — often lured by overly bullish financial news undoubtedly — will get burned, together with some of the smaller lenders who cannot get enough money back in time.

Capitalist protectionism, at its worst.