the LTRO does not solve the longer term problems of the solvency or funding of the banks, which now remain heavily dependent on the largesse of the central banks. It is government sponsored Ponzi scheme where weak banks are supporting weak sovereigns who in turn are standing behind the banks – a process which can be best described as two drowning people clinging to each other for mutual support.Read it at Naked Capitalism
The European Debt Crisis Redux
By Satyajit Das
Ponzi schemes can continue far longer than most expect, but eventually all such schemes are revealed and losses must be accepted. The question remains, in this instance, who will be forced to accept the losses...Bank creditors or public taxpayers? My bet remains on the latter.