Stratfor shoots down Banking Union Non Solution.After the ECB and then the BOE held off from cutting rates , very interestingly China just announced it's cutting lending and deposit rates by 25 bps ! What a way to deflect attention from non action by the ECB and BOW ( neither rate cuts nor QE from either Central Bank . )

http://www.zerohedge.com/news/europes-banking-union-non-solution

Europe's Banking Union 'Non-Solution'

Submitted by Tyler Durden on 06/07/2012 17:37 -0400

• Sovereign Debt
 
• Unemployment

While not quite Biderman-rant-worthy, Stratfor's more-attractive-than-CharlesKristen Cooper provides a brief and clear explanation, in this clip, of why the creation of a European banking union, which seems to be the cure-du-jour, will do little to help the eurozone's ongoing crisis in the short-term. The degree of political integration required in order to agree on such a solution will take years to conclude in her opinion with the various constituencies all with different levels of urgency and time-horizon. The sad truth is that while focusing on yet another grand plan will make the leaders of Europe appear as though they are doing 'something' (to themselves and others), a banking union in and of itself does little to solve the raging unemployment and more specifically the distrust of Spanish banks. The idea of a banking union is not new (where Berlin would share liabilities for deposits held by Spanish banks, for example, and in return would enable an integrate supervisor of the financial sector - some sovereignty give-ups), but as Kristen concludes: "How long can the eurozone's political elite focus on long-term solutions concerned with sovereign debt and banking bailouts before a genuine social crisis emerges."

In a little under 4 minutes Cooper provides everything you need to know about the 'possibilities' of the Banking union - and its clear non-panacea - but were afraid to ask. 

Beware the distraction of this topic by the propoganda-mongerers - as Stratfor quite clearly demonstrate, this is not a solution.

http://www.zerohedge.com/news/china-joins-global-easing-party-cutting-lending-and-deposit-rates-25-bps

China Joins Global Easing Party By Cutting The Lending And Deposit Rates By 25 bps

Submitted by Tyler Durden on 06/07/2012 07:08 -0400

• Bank of England
 
• China
 
• People's Bank Of China

While minutes ago the Bank of England followed in the ECB's footsteps, it was the China central bank that stole England's thunder, announcing an unexpected rate cut moments before 7 am, and thus finally joining the global easing party. As a reminder, hours before the global central bank intervention on November 30, China announced its first (50 bps) reserve requirement cut since 2008. Is today's PBOC move, which is the first cut of deposit and 1 year lending rates also since 2008, a harbinger of something much bigger to come any second now?

From the PBOC:

The People's Bank of China decided to cut financial institutions RMB benchmark deposit and lending interest rates since June 8, 2012. One-year benchmark deposit rate cut of 0.25 percentage points, year benchmark lending interest rate cut by 0.25 percentage points; other deposit and lending interest rates and individual housing provident fund deposit and lending rates be adjusted accordingly.

Since the same day: (1) the upper limit of the floating range of interest rates on deposits of financial institutions was adjusted to 1.1 times the benchmark interest rate; (2) loans from financial institutions interest rate floating range of the lower limit was adjusted to 0.8 times the benchmark interest rate.