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Thread: German Banks: The Rotten Heart of Europe

  1. #1
    Politics.ie Member Volatire's Avatar
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    Default German Banks: The Rotten Heart of Europe

    Europhiles like to portray German banks as paragons of prudence, and German financial regulation as a model to be emulated. Colm McCarthy skewers this laughable nonsense:

    The publicly owned Landesbanks in Germany have been a disaster area West Deutsche Landesbank, based in Dusseldorf, has had to be wound down and several others have incurred horrendous losses and have been closed, bailed out or restructured. The German bank regulator, called Bafin, has failed dismally and the popular perception of Germany as a model of financial caution for the rest of Europe is well wide of the mark.
    German banks remain over-leveraged and undercapitalised:

    Deutsche Bank had 2,012.3bn in assets but just 54.4bn in shareholder equity, 2.7 per cent of assets. Put another way, Deutsche Bank had a leverage ratio of 37 times, that is, its assets were 37 times its capital...

    Deutsche is Germany's largest bank and one of the largest in the world. The bank's balance sheet equals about 56 per cent of Germany's GDP. If Deutsche ever got into trouble, even the German treasury would struggle to bail it out.
    The US has already bailed out European banks once:

    The US taxpayer has already done a big favour for Europe when the government bailed out US financial institutions whose failure would have bankrupted large swathes of the European banking system. US regulators are understandably anxious to avoid any repetition.
    The US wants US subsidiaries of European banks to come up with more capital to cover potential losses:

    US regulators, who want big European banks operating in the US to put dedicated risk capital into their large US subsidiaries. The US arm of Deutsche currently has no equity at all and the US authorities are naturally concerned about this.
    All of which is a far cry from the fantasies peddled by the kneejerk europhiles of p.ie ....

    Europe must fix its broken banks - Independent.ie

  2. #2

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    wrong forum. move to Europe or zoo your choice.

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    Politics.ie Member Nemesiscorporation's Avatar
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    Quote Originally Posted by Volatire View Post
    Europhiles like to portray German banks as paragons of prudence, and German financial regulation as a model to be emulated. Colm McCarthy skewers this laughable nonsense:



    German banks remain over-leveraged and undercapitalised:



    The US has already bailed out European banks once:



    The US wants US subsidiaries of European banks to come up with more capital to cover potential losses:



    All of which is a far cry from the fantasies peddled by the kneejerk europhiles of p.ie ....

    Europe must fix its broken banks - Independent.ie
    I see the Fianna Fail fightback to blame everyone but themselves has begun in earnest.

  4. #4

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    Quote Originally Posted by Nemesiscorporation View Post
    I see the Fianna Fail fightback to blame everyone but themselves has begun in earnest.
    wasn't Colm McCarthy touted the architect of Fianna Fail's austerity program? What a tosser. The imbecile is good at throwing mud though.

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    Politics.ie Member Dublin 4's Avatar
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    Stop spoiling my drip feeding of info.

    There's a time & place for turning up the heat on reality deniers

    But since yer at it.

    Apart from 2 trillion euros ($2.7 trillion) of public debt, there are liabilities of another 5 trillion euros because of shortfalls in the social security and pension funds,


    Germany Has 5 Trillion Euros of Hidden Debt, Handelsblatt Says - Bloomberg

  6. #6

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    The German banks were at the Fed Emergency window in 2008 same as the other banks. We only found out about that because of congressional hearings on the banking crisis in the US.

    The German banks weren't doing anything else other than what the American banks were doing- ie wrapping up and selling worthless debt at an inflated price to each other. As well as arranging disastrous deals via the Landesbanken to German state administrations- disastrous for the German taxpayer that is.

    To those who tout the German model of governance I would say 'Hypo'.

  7. #7

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    Quote Originally Posted by Bartholomew Fair View Post
    The German banks were at the Fed Emergency window in 2008 same as the other banks. We only found out about that because of congressional hearings on the banking crisis in the US.

    The German banks weren't doing anything else other than what the American banks were doing- ie wrapping up and selling worthless debt at an inflated price to each other. As well as arranging disastrous deals via the Landesbanken to German state administrations- disastrous for the German taxpayer that is.

    To those who tout the German model of governance I would say 'Hypo'.


    that's all you have? why does the German debt to GDP stand at only at 82% then?

    move the hate thread to the zoo where it belongs.

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    Politics.ie Member Casablanca's Avatar
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    7 posts and no Goodwins yet? Ye're slowing lads.........
    Even Educated Fleas Do It...

  9. #9

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    Why are you so distressed by actual news? Did you yawn when Lenihan put the nation on the hook for crooked Irish banks?

  10. #10
    Politics.ie Member Boy M5's Avatar
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    Quote Originally Posted by Bartholomew Fair View Post
    The German banks were at the Fed Emergency window in 2008 same as the other banks. We only found out about that because of congressional hearings on the banking crisis in the US.

    The German banks weren't doing anything else other than what the American banks were doing- ie wrapping up and selling worthless debt at an inflated price to each other. As well as arranging disastrous deals via the Landesbanken to German state administrations- disastrous for the German taxpayer that is.

    To those who tout the German model of governance I would say 'Hypo'.
    Or the hapless BayernLB
    "Keep firing & don't stop until I tell you" General Tom Barry

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