The Emperor in Basel is freaking naked!

Sir, all general bank crisis, as well as most individual bank defaults, have NOT resulted from lending or investing excessively in something perceived as risky, but from either unlawful behavior, or the excessive lending or investment in what was wrongfully perceived as not risky.

Against that backdrop… can you please explain to me the rationale of having capital requirements for banks based on perceived risk? If anything, should these not then be higher for lending or investing in that which is perceived as not risky?

But No! The regulators in the Basel Committee and the Financial Stability Board, they insist on discriminating against those bank clients and operations their official risk-perceivers, the credit rating agencies, perceive to be risky, or have not looked at... like the small businesses or entrepreneurs we wish and need to have access to bank credit. And, in doing so they also, of course, become the most important pushers of excessive lending or investment in that extremely dangerous zone of what is officially perceived as not risky.

And that is why, frankly, I cannot, for instance, muster as much enthusiasm as you do, for a Mario Draghi.