What is the European Central Bank up to?

The European Central Bank (ECB) is currently carrying out a stately progress. Commentators say that it will implement eventually the dreaded quantative easing (printing money). However, this is a bit late compared with the U.S Federal Reserve and our very own, the one only Bank of England, in association with the UK Treasury. At each stage of this monetary cycle the ECB has been dragged kicking to act.
It also shows a natural bias of supporting the requirements of Germany rather than the Mediterranean members of the Eurozone, Spain, Italy, Portugal and Greece. The Frankfurt-based institution would probably prefer a hard Euro and would love to be the world's reserve currency.
The European Union's economic and monetary affairs commissioner Joaquin Almunia has stated that no member country will leave the Eurozone and noted that other countries wanted to join. However, Almunia has been unable to protect Ireland, for example, where the euro exchange rate has given its significant trade partner the UK a major advantage.

Spanish banking sytem going for a bust?

Yesterday, the Daily Telegraph published a thoughtful article on the Spanish banking system saying that the national market for mortgage-backed securities has shut down.
The major Spanish banks and savings banks are making major borrowings direct from the
European Central Bank (ECB). There is concern about the Spanish property market, which I think is way overpriced. The market for costa properties has stopped functioning and there is going to be a bit of a bust after so many boom years.
However, it is still a great place to live!

Northern Rock yet again!!

Sorry to revisit Northern Rock yet again but the weekend press has got me
thinking. It looks like a lot of people are guilty of 20-20 hindsight similar
to the collapse of Polly Peck, where one factor was the probing of the published
accounts by a Swiss German investor. If it was not for the credit crunch,
Northern Rock would still be around. If it was not for the Bank of England refusing
liquidity to help the interbank market, in constrast to the U.S Federal Reserve
and to the European Central Bank (ECB), then again the Newcastle-based institution
would be still with us. It looks like Northern Rock was hit by a perfect
storm.
However, Alistair Blair writes a perceptive piece in the Investors Chronicle, which
questions the famed low costs of Northern Rock and notes that its financial
strength was compromised by its reliance on short term borrowings rather than
customer deposits. Blair says the audit report could have been complemented by
a validation report, which would have pointed out its future financial
problems.
In the blame game nobody comes out very well but I thought Chancellor Alistair
Darling did put his head over the parapet in a media blitz. Some commentators
say Northern Rock depositors ignoring Darling's calls reflected the loss of trust
in politicians. Perhaps more of a factor was scrutiny of the deposit compensation
scheme. This led to a realisation with its lack of protection for relatively
minor sums.