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Re: Brit News/1
Having been among the first in Europe to start bailing out their failing Landesbanks [for their foolish decisions to invest in US mortgage securities instead of supporting lending in their own states], this seems a bit of blatant hypocrisy...Originally posted by Mega View Post
...Ms Merkel said that Germany could not and would not issue a blank cheque for all banks, “regardless of whether they behave in a responsible manner or not”...
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Re: Brit News/1
And how we have the confirmation of that hypocrisy. Clearly one should never take anything a politician says very seriously...even a German politician...:pOriginally posted by GRG55 View Post
Germany agrees bank rescue and guarantees savings
Sun Oct 5, 2008 7:19pm EDT
BERLIN (Reuters) - Germany acted to stem turmoil in its financial sector Sunday, thrashing out a new rescue for imperiled lender Hypo Real Estate and, in a surprise move, pledging to guarantee private savings accounts.
After German banks and insurers shocked the government on Saturday by withdrawing support for a government-led 35 billion euro ($48.50 billion) rescue for HRE, Berlin scrambled to hammer out a new deal before markets opened Monday.
Under an accord, struck just after 11 p.m. (5 p.m. EDT), the financial sector agreed to provide an extra 15 billion euros ($20.8 billion) in liquidity for HRE on top of the 35 billion they had already committed together with the Bundesbank, the Finance Ministry said.
"With this commonly forged solution, (Hypo Real Estate) will be stabilized and thereby the German financial marketplace strengthened in difficult times," the ministry said.
Earlier, the government said it had agreed to guarantee private deposits to help restore confidence amid the worst financial crisis since the 1930s.
"We say to savers that their deposits are safe," Chancellor Angela Merkel told a news conference in Berlin.
The move was a surprise because, behind the scenes, German officials had been highly critical of Ireland when it announced a similar move last week...
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Re: Brit News/1
what's missing is any statement of eurozone-wide or coordinated fiscal as well as monetary intervention. the ecb has now indicated it MAY ease rates some day, but not yet. [kind of the opposite of "make me chaste- but not yet."] but the euro governments are acting in piecemeal fashion, addressing their national banking industries one disaster at a time. they are back at the bear stearns/aig stage of development, so very far behind where the u.s. is.
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Re: Brit News/1
It is interesting that this is coming from Germany of all places. A nation that fears inflation like no other, and a nation that was almost the sole exception to the global real estate bubble [in the first part of this decade German residential real estate nominal prices actually declined slightly almost each and every year].Originally posted by jk View Post
Now that Germany has lost its virginity, I wonder if that paves the way for the ECB's inevitable, long awaited and long demanded [by numerous other EU nations] rate cut.
I am not sure how piecemeal this will continue to be, given the EU meeting this weekend. I suspect they did this for more than photo-ops to boost confidence.Comment
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