Over the years, Europe has faced significant financial struggle and problems within their banking systems. However, as of today, they are in a very strong place to avoid further stress on its banking system after learning many lessons from its financial crises over the years. The United States on the other hand are still learning very crucial lessons about how to endure stress on their banking systems. In early March of 2023, there was a large collapse of the U.S. based Silicon Valley Bank, and several other regional lenders of these banks. This is causing a large amount of uncertainty and anxiety for the rest of the fiscal year, and in future years. However, the European Central Bank does not have this same worry factor. This is where central planning can be an effective tool in order to ease the uncertainty and anxiety that comes with the downfall of the central banking systems. If central planning were to be utilized in the united states, it might help them reach the level of European banking systems in their security.
3 comments:
Great article Eliza! It's a huge positive that Europe appears to have learned from its mistakes and implemented measures to prevent further stress on its banking system. Hopefully, the US can manage to successfully do the same soon as well. Policymakers need to take steps to address the current issues in the banking system to prevent further collapses and uncertainties.
The current condition of the US economy is very concerning as we have seen recent struggles in the finance industry. There is definitely much uncertainty in the market. It will be interesting to see how the government and the federal reserve will respond throughout 2023.
These are very current issues in the United States and I am curious to see if anyone will end up bailing out Sillicon Valley Bank. As we know, SVB has lost its reputation in the banking sector and is causing extreme uncertainty to the people who hold their money there. This leads to bank runs and millions of dollars withdrawn in a short amount of time. I am curious to see if the United States ever adopts the European style of banking in which they are centerally planned. This would eliminate all bank runs and all uncertainites and anxieties that anyone may have. But at what cost.
Overall, good post!
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