Is the Catholic Church now telling the Lutheran Church: “Thou shall not sell carbon indulgences”?

Sir I refer to James Politi’ and Giulia Segreti’s “Pope says multinationals and greed threaten environment” June 19.

Pope Francis’ encyclical Laudato Si states: “171. The strategy of buying and selling “carbon credits” can lead to a new form of speculation which would not help reduce the emission of polluting gases worldwide. This system seems to provide a quick and easy solution under the guise of a certain commitment to the environment, but in no way does it allow for the radical change which present circumstances require. Rather, it may simply become a ploy which permits maintaining the excessive consumption of some countries and sectors.”

I have for years I argued that the “carbon credits” so much promoted by Germany among others, are like the indulgences sold by the Catholic Church for the forgiveness of sins, and which Martin Luther protested. And so now, in a strange twist of history, it seems it is the Catholic Church that is telling the Lutheran Church “Thou shall not sell indulgencies”

@PerKurowski

To break Italy’s, Europe’s and America’s vicious circle, their current central bankers and regulators should resign.

Sir, Giulia Segreti and Guy Dinmore report that “Italy’s central bankers fears ‘vicious circle’” November 1. That is Italy’s Europe’s and America’s problem, that their central bankers are not even aware that they already find themselves in the most vicious financial circle ever, only because of their own bank regulatory doings. That vicious circle goes like this: 

It starts with regulators foolishly trying to avoid bank failures by allowing banks to hold less capital when lending to those perceived as less risky “The Infallible” than when lending to those perceived as “The Risky”. 

That signifies that “The Infallible” will have access to bank credit more generously, cheaper and in easier terms than what would otherwise have been the case. While likewise “The Risky” will have less access to bank credit, will have to pay higher interest and need to accept harsher terms. 

And that signifies that “The Infallible”, like the AAA rated, real estate sector and sovereigns (like Greece) little by little will over-borrow and turn into huge unmanageable risky assets, while “The Risky” like small businesses and entrepreneurs will not be financed, and so there will be little of the new sturdy economic growth, and jobs, they can help to provide. 

And when it explodes there will be less and less safe havens were banks, because of the lack of equity, need to take refuge… and we all know what happens to a safe haven when it gets to be overpopulated. 

So if central banker fears a vicious circle, perhaps the best they can do to break it, is to resign and let a new generation of regulators take over. 

And if little me was one of those regulators, the first thing I would for the time being suggest doing, is to cut in half, at least, the capital requirements for banks when lending to small businesses and entrepreneurs. And that I would do in the perfect knowledge that I need their help to rescue the economy and create jobs, and that “The Risky” have never ever caused a major bank crisis, only “The Infallible” do that when they… sooner or later, always fail.

Bank regulators, stop protecting the vested interest of the “not-risky”, which discriminates against the “risky”.

Sir, James Wilson and Giulia Segreti reports that “ECB calls for ‘courageous’ action to tackle‘vested interests’” and of “the need to bring down labour costs, boost productivity and improve the business climate”, August 10. 

Absolutely! But why does not ECB ask regulators to stop protecting the vested interest of those perceived as “not-risky” with their capital requirements for banks based on perceived risk. These regulations are precisely the main cause for why the report also states that “Coldiretti, the Italian agricultural association, estimates that 60 per cent of companies in the sector risk being starved of credit as they face interest rates that are 30 per cent higher than the average of other sectors” 

Really, bank regulators who allow banks to lend without any capital to supposedly infallible sovereigns and very little capital to what private is AAA rated while at the same time requires the banks to hold much more capital when lending to the “risky”, like small businesses and entrepreneurs, should be ashamed of themselves. They have no idea of what banking is all about. They are guilty of causing “L’economia castrata” and which threatens to bring theWestern world to its knees.