Germany's go-it-alone decision to prevent a run on its banks by guaranteeing up to €1 trillion of individuals' deposits was followed yesterday by several other EU countries.
Amid bitter recriminations about Berlin's shock move on Sunday, Spain indicated that it could soon join Austria, Denmark, Greece, Ireland and Sweden in offering a full government guarantee for deposits.
Spain was enraged at being left out of Saturday's emergency summit of British, French, German and Italian leaders when its banks have proven safe so far, and demanded talks for its prime minister, José Luis Rodríguez Zapatero, with Sarkozy in Paris this week. Zapatero held an emergency meeting with leading bankers in Madrid last night.
Pedro Solbes, the Spanish finance minister and a former EU commissioner, said: "I would have preferred that no member country took decisions unilaterally which are always negative.
"If each country maintains its position, we'll have to look at the impact it's having on Spain."
So, just where should we put our money; Ireland, Germany, Denmark....?
The very last thing the banks need are for people to start moving their savings from one place to another. Nothing would destabilise the already fragile system more. Anyone with large savings is naturally going to be nervous but all this clamouring to assuage them isn't necessarily going to help. If anything it will make them even more nervous. God help us if people start hiding their money under the bed to keep it safe.
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