ASSESSMENTS

How the End of 'Too Big to Fail' Will Hurt the Eurozone

Nov 18, 2014 | 10:00 GMT

Leaders meet Nov. 15 during a plenary session at the G-20 summit in Brisbane, Australia.
New regulations are having harmful consequences in the area least equipped to handle them.

(ROB GRIFFITH-POOL/Getty Images)

The increase in banking regulation follows a predictable path. In the West, it will succeed in its ambitions of ending too big to fail, at least in the medium term. Ultimately, complacency and greed will erode the new regulations and a banking crisis will result, though that will fall within the purview of a regulator far in the future. In the emerging world the future is less clear, since there is less anti-banking sentiment in these countries, there is also less political capital to be gained by bashing banks....

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