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Economic news from Europe

 
 
Aardvark
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      10-18-2008
It seems that the lower house in Germany has approved a €480 billion
(yes, that's four hundred and eighty BILLION eurodollars) to bail out the
German banks from the current financial crisis.

I should think that the plan will now go to the upper house for
inspection.

--
Liverpool. European City Of Culture 2008
http://www.liverpool08.com
 
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      10-18-2008
Aardvark wrote:

>It seems that the lower house in Germany has approved a 480 billion
>(yes, that's four hundred and eighty BILLION eurodollars) to bail out the
>German banks from the current financial crisis.
>
>I should think that the plan will now go to the upper house for
>inspection.


A tad bit more than 39 billion and Germany will be nearly match with
the wasted $700 billion (USD), which was supposed to have stabilised
markets here abouts.

If it were up to me, I'd nominate this so-called "plan" for more than
simple "inspection".
 
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HEMI-Powered
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      10-18-2008
Aardvark added these comments in the current discussion du jour
....

> It seems that the lower house in Germany has approved a €480
> billion (yes, that's four hundred and eighty BILLION
> eurodollars) to bail out the German banks from the current
> financial crisis.
>
> I should think that the plan will now go to the upper house
> for inspection.
>

Aardvark, harkening back to our larger discussion of spending on
the military, social programs, and now bailouts as some
percentage either per capita of of GDP, half a trillion euros in
Germany is even larger than what I've heard the UK spending has
been so far, reported here as mid $400B range when converting
from Pounds to dollars.

This is truly astounding to me given the relative sizes of the
respective economies as measured by GDP. Ditto for Japan's
infusion of capital. I am not privy to the inside info,
naturally, but wouldn't understand it if I were. But, my take on
this is that at least one reason - if not the biggest one - that
the problem that started as a subprime mortage issue just in the
US suddenly looms even larger across all the world's economies
because so much money is interlocked amonst the G-7 and G-20
central banks, but ALSO because so much of American debt is owed
to countries outside the US, principly China.

--
HP, aka Jerry

"Efficiency is doing things right, effectiveness is doing the
right things" - Peter Drucker
 
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HEMI-Powered
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      10-18-2008
added these comments in the current discussion du jour ...

> Aardvark wrote:
>
>>It seems that the lower house in Germany has approved a 480
>>billion (yes, that's four hundred and eighty BILLION
>>eurodollars) to bail out the German banks from the current
>>financial crisis.
>>
>>I should think that the plan will now go to the upper house
>>for inspection.

>
> A tad bit more than 39 billion and Germany will be nearly
> match with the wasted $700 billion (USD), which was supposed
> to have stabilised markets here abouts.
>
> If it were up to me, I'd nominate this so-called "plan" for
> more than simple "inspection".
>

I only wish I could be sure that any of this is or is not
"wasted" or that any of this will or won't fix the problem, but
once a snowball rolls down hill, it becomes far more difficult to
stop than it ever is to prevent rolling down in the first place.

See other of my comments and Aardvarks, but please pay special
attention to the notion of how international banks and
governments have an incestuous relationship with each other that
tends to aggravate any dislocations.

--
HP, aka Jerry

"Efficiency is doing things right, effectiveness is doing the
right things" - Peter Drucker
 
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Aardvark
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      10-18-2008
On Sat, 18 Oct 2008 13:04:12 +0000, HEMI-Powered wrote:

> Aardvark added these comments in the current discussion du jour ...
>
>> It seems that the lower house in Germany has approved a €480 billion
>> (yes, that's four hundred and eighty BILLION eurodollars) to bail out
>> the German banks from the current financial crisis.
>>
>> I should think that the plan will now go to the upper house for
>> inspection.
>>

> Aardvark, harkening back to our larger discussion of spending on the
> military, social programs, and now bailouts as some percentage either
> per capita of of GDP, half a trillion euros in Germany is even larger
> than what I've heard the UK spending has been so far, reported here as
> mid $400B range when converting from Pounds to dollars.
>


I saw the figure last night and knew even without trying to do any simple
arithmetic that the amount would be far in excess in real terms (ie USD)
than the Bush rescue package. I knew that it would be of moderate
interest to yourself and that's why I made the OP .

> This is truly astounding to me given the relative sizes of the
> respective economies as measured by GDP. Ditto for Japan's infusion of
> capital. I am not privy to the inside info, naturally, but wouldn't
> understand it if I were. But, my take on this is that at least one
> reason - if not the biggest one - that the problem that started as a
> subprime mortgage issue just in the US suddenly looms even larger across
> all the world's economies because so much money is interlocked amongst
> the G-7 and G-20 central banks, but ALSO because so much of American
> debt is owed to countries outside the US, principally China.


It still remains to be seen what the upper house in Germany thinks of the
plan, so the situation there is by no means cut-and-dried.



--
Liverpool. European City Of Culture 2008
http://www.liverpool08.com
 
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HEMI-Powered
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      10-18-2008
Aardvark added these comments in the current discussion du jour
....

>> Aardvark, harkening back to our larger discussion of spending
>> on the military, social programs, and now bailouts as some
>> percentage either per capita of of GDP, half a trillion euros
>> in Germany is even larger than what I've heard the UK
>> spending has been so far, reported here as mid $400B range
>> when converting from Pounds to dollars.

>
> I saw the figure last night and knew even without trying to do
> any simple arithmetic that the amount would be far in excess
> in real terms (ie USD) than the Bush rescue package. I knew
> that it would be of moderate interest to yourself and that's
> why I made the OP .


This is of interest to me, and should be for everyone. My comment
above is simply to illustrate that I see the advantage you
asserted days ago in putting the bailout spending of any given
country into some perspect wrt others by using GDP, that's all.

>> This is truly astounding to me given the relative sizes of
>> the respective economies as measured by GDP. Ditto for
>> Japan's infusion of capital. I am not privy to the inside
>> info, naturally, but wouldn't understand it if I were. But,
>> my take on this is that at least one reason - if not the
>> biggest one - that the problem that started as a subprime
>> mortgage issue just in the US suddenly looms even larger
>> across all the world's economies because so much money is
>> interlocked amongst the G-7 and G-20 central banks, but ALSO
>> because so much of American debt is owed to countries outside
>> the US, principally China.

>
> It still remains to be seen what the upper house in Germany
> thinks of the plan, so the situation there is by no means
> cut-and-dried.
>

The nature of most governments reacting to a crisis rather than
planning to prevent one, is that the party in power attemts to
rush the fix through their legislative branch or whatever the
legal mechanism is for authorizing fiscal action, but NOT
providing full transparency via public hearings. The oft repeated
reason, pretty bogus at best, is that their ain't enough time but
perhaps there isn't time NOT to hold hearings.

But, as we've seen the credit crisis and the market sell offs
getting larger, not smaller, it does beg the question why there
were NO hearings in about any country either during the earliest
days of meddling in the home mortgage markets or now during the
desperation of fixes.

Screaming in alarm helps no more now than it did when Chicken
Little said the sky was falling.

--
HP, aka Jerry

"Efficiency is doing things right, effectiveness is doing the
right things" - Peter Drucker
 
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Aardvark
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      10-18-2008
On Sat, 18 Oct 2008 14:10:51 +0000, HEMI-Powered wrote:

> This is of interest to me, and should be for everyone. My comment above
> is simply to illustrate that I see the advantage you asserted days ago
> in putting the bailout spending of any given country into some perspect
> wrt others by using GDP, that's all.


Was there really any need to look into Germany's GDP either as a country
or per capita to know that the amount is little short of incredible? I
think not

Despite this, the following are the 2007 figures from the good old CIA:

GDP (purchasing power parity): $2.807 trillion (2007 est.)

GDP (official exchange rate): $3.322 trillion (2007 est.)

GDP - real growth rate: 2.5% (2007 est.)

GDP - per capita (PPP): $34,100 (2007 est.)

HTH mate.

--
Liverpool. European City Of Culture 2008
http://www.liverpool08.com
 
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