to add to that, it is important that they be held accountable for the outcomes of that decision. There are 2 options: (1)depositors are guaranteed by taxpayers (2)depositors are not guaranteed by taxpayers. The EU is trying to implement a 3rd option: banks never lose depositors' deposits.
The 3rd option is nonsensical. At some point banks will fail. The market works better when the decision maker has skin in the game but there will still be failures and we (nations and individuals including pensioners cannot be shielded from reality completely.
The 3rd option is nonsensical. At some point banks will fail. The market works better when the decision maker has skin in the game but there will still be failures and we (nations and individuals including pensioners cannot be shielded from reality completely.