Europe, to cure its malaise, more than affordable credit, needs correct and justly priced credit.

Sir, Tony Barber writes “Affordable credit for all will help cure Europe’s malaise” June 7. No! Credit should not be allotted based on it being affordable, but based on who pays its correct price.

"Credit is the oxygen of an advanced economy, innovation and investment are its lifeblood” Yes! But the alveoli and capillaries of the banking system, the lungs of the economy, have been made dysfunctional by dumb bank regulators.

And that the Basel Committee did when it decided that banks were allowed to hold less capital when lending to what is perceived as “absolutely safe” than when lending to what is perceived as “risky”, which means that banks earn a much higher expected risk-adjusted return on equity when lending the “The Infallible” than when lending to “The Risky”.

And, as a result of the messing around with the lungs, now “The Infallible” get blood with too much and to cheap oxygen while “The Risky” do not only receive blood with less oxygen but must also pay more for it. And that Sir, that is Europe´s malaise.