Reader Gary reminds us that the Basel-II Accords are just that: an agreement among banks, not a set of laws. Participation is voluntary (but highly recommended). I don't know all the details.
Presumably a nation could make compliance compulsory, but I don't know if any have yet.
Although it is an agreement, it has rules, and one of those is not to do business with non-compliant banks in other countries.
They keep talking about the current crisis saying things like "banks are now even refusing to lend to EACH OTHER.." and I can't help but wonder if Basel-II is not at least part of that.
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Re: CHINA BANKS TOLD TO HALT LENDING TO US BANKS
Billy,
Here is my take on the Basel II accords.I sent this out to some friends on Monday.
My Rant 9-21-2008
I have done a lot research into the Basel I and Basel II accords and how they fit in with the current financial chaos. I have researched articles from all over the globe, the Federal Reserve web site and the Bank for International Settlements web site. I even have an OCC Report (OCC http://www.occ.treas.gov/ ) “Comptroller of the Currency Administrator of National Banks” (This Federal agency has been around since 1863) [Docket ID OCC- 2008-0009] published in the Federal Register on 12-07-2007 (Date of Pearl Harbor attack purely a coincidence).
With a Glossary of Terms in hand related to the new Basel Capital Accord, I dissected the information noted above. I have come to realize that the "So Called Rigid Basel II Accord" that was to bring about this major correction thru New Capital requirements (8% minimum) for the on and off balance sheet accounts “dose not exist” as a Law or even a Rule. What I have found in the language in the OCC-2008-0009 is nothing more but the same SELF-REGULATING Principal based systems found in the Basel I Accords. The main revision appears in the Pillar 2 (Supervisory Review) called "Advanced Approaches". There is no mention of bringing the off-balance sheet derivate contracts back to on-balance sheet status. The OCC-2008-009 report is broken down into 46 bullet points.
What I have found that in every bullet point 1 to 46 within the first sentence the words "should", "may", "general" dominate the outlines for the banks to follow. Nowhere have I found language to Laws or Statues.
This whole thing smells like Global Social Engineering by the International Elite Chess Masters using the creation and then the destruction of wealth as a controlling mechanism.
I have listed some Thomas Jefferson Quotes (emphasis mine).
The central bank is an institution of the most deadly hostility existing against the Principles and form of our Constitution. I am an Enemy to all banks discounting bills or notes for anything but Coin. If the American People allow private banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the People of all their Property until their Children will wake up homeless on the continent their Fathers conquered.
Thomas Jefferson
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