Germany considers direct lending

[Sapiens]

http://www.telegraph.co.uk/finance/f...t-lending.html

Germany considers direct lending
The German government is mulling the "unprecedented" step of lending directly to companies as credit dries up for both Mittlestand family firms and the industrial export giants.

Peer Steinbrück, the country's finance minister, said radical action is called for as the credit crunch "manifests itself more and more", leaving companies struggling to roll over debts.

"We have to be braced," he said after a meeting of finance ministers in Brussels. He also called for "urgent action" to relax the Basel II rules on capital adequacy so that bank capital "isn't literally eaten up".

...

Now we are talking... Will the banksters let it happen? Place your bets...

[don]

Re: Germany considers direct lending

Today's assignment in political economy :cool:

[Slimprofits]

Re: Germany considers direct lending

http://news.my.msn.com/business/arti...mentid=3441869

German central bank chief Axel Weber said on Tuesday that he and eurozone peers did not need to extend credit directly to companies, rejecting an idea proposed by German finance minister Peer Steinbrueck earlier.

"The Bundesbank sees no need for that," Weber said in an unusual statement issued directly by the German central bank.

Such measures had not been discussed by the European Central Bank's (ECB) governing council, of which Weber is a key member, and would only become an issue if the eurozone banking system became dysfunctional, Weber said.

Germany is not gripped by a credit crunch, he added.

[..]

The comments came after Steinbrueck said in Brussels that the government and Bundesbank might provide credit directly to the private sector, bypassing banks which have been accused of restricting lending.

A record one-year loan operation by the ECB on June 24 put 442 billion euros (620 billion euros) at the disposition of commercial banks, but they do not appear to have passed much of it on to private borrowers.

That has upset business leaders, politicians and ECB president Jean-Claude Trichet, who called on banks last week to live "up to their responsibilities" in providing credit to the recession-hit eurozone economy.

But Weber stressed that the ECB would do its job without political pressure, saying: "The Eurosystem (of central banks) makes its decisions independently from politics and economic institutions."

unusual eh? That's interesting.

[don]

Re: Germany considers direct lending

German central bank chief Axel Weber said on Tuesday that he and eurozone peers did not need to extend credit directly to companies, rejecting an idea proposed by German finance minister Peer Steinbrueck earlier.

"The Bundesbank sees no need for that," Weber said in an unusual statement issued directly by the German central bank.

Such measures had not been discussed by the European Central Bank's (ECB) governing council, of which Weber is a key member, and would only become an issue if the eurozone banking system became dysfunctional, Weber said.

Germany is not gripped by a credit crunch, he added.

[..]

The comments came after Steinbrueck said in Brussels that the government and Bundesbank might provide credit directly to the private sector, bypassing banks which have been accused of restricting lending.

A record one-year loan operation by the ECB on June 24 put 442 billion euros (620 billion euros) at the disposition of commercial banks, but they do not appear to have passed much of it on to private borrowers.

That has upset business leaders, politicians and ECB president Jean-Claude Trichet, who called on banks last week to live "up to their responsibilities" in providing credit to the recession-hit eurozone economy.

But Weber stressed that the ECB would do its job without political pressure, saying: "The Eurosystem (of central banks) makes its decisions independently from politics and economic institutions."

Weber closed the meeting by saying he had seen a unicorn on his way to work this morning.