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Merkel has banks in her sights

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Merkel has banks in her sights


Germany has taken the radical step of banning so-called ‘naked short-selling’ of stocks in a bid to restore some stability to jittery European markets.

Naked short-selling involves a trader selling shares or investments he or she does not formally own. The system exists for one reason only and that is to drive down stock prices. It is already illegal in the US.

Now Berlin is doing the same but, while at first sight, it appears to be a positive move, Germany is part of the euro zone and autonomous policy decisions are not popular.

The news immediately pushed down an already falling euro to a new four year low against the dollar.

But Chancellor Angela Merkel has the banks in her sights in more ways than one. During talks with Austria’s Chancellor she discussed pushing for a tax on financial transactions, to help cover the cost of the debt crisis.

Merkel’s initiatives come as Germany’s lower house of parliament is set to vote on Friday on Berlin’s part in the recent multi-billion euro rescue package.

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