Comments on: Germany guarantees all deposits

By: Lola

Lola — Mon, 06 Oct 2008 14:44:55 +0000

Yep, they must recapitalise – but not at my expense as either a taxpayer or bank customer. They need very careful watching to ensure that they just do not simply improve their balance sheets by wrecking mine.

By: mikestallard

mikestallard — Mon, 06 Oct 2008 07:46:59 +0000

I do not understand banking and I do not understand deleveraging.
Is short selling always bad? Ought, at the end of each day, a bank to prepare, for the government, a spreadsheet showing its assets and is this what the EU (through Basel II) is demanding?
I have not got a clue.
How much does Gordon Brown really owe? And how much does, say, Barclays, or NatWest really owe? I have not got a clue.
So why has, say, a Treasury official? They may have figures in front of them. But are those figures real? Do they have any sense of the unintended consequences? Quite often, such officials (see Rod Liddle this week on the Guardian's list of forbidden words) are not even allowed to speak the truth!
At the end of the day, the Chancellor, Mr Darling, is not a banker, not a financial wizard. He is a lawyer from Edinburgh with a lot of political experience.
I suspect the EU officials are just the same.
So are they driving us onto the rocks? Time will tell. But things do not look good.

By: michael, islngton

michael, islngton — Mon, 06 Oct 2008 00:21:04 +0000

Seems your earlier request for British banks to be recapitalised has been actioned but the form of cash injection is likely to make you choke on your rice crispies this morning.

Taxpayers will be doing the decent thing.

By: APL

APL — Sun, 05 Oct 2008 23:22:19 +0000

JR: "Today Germany has taken far reaching action, following more problems at Hypo Real Estate.2

Funny, deafening silence from the European Union. Just as they were getting up with a head of steam over the similar Irish guarantee too.

By: Mark Wadsworth

Mark Wadsworth — Sun, 05 Oct 2008 22:23:12 +0000

The sooner [the banks] get on with the task of recapitalising themselves the better. Exactly - but recent rights issues have been a bit of a disaster, it's too late for that. Politicians now bandy around the stark choice of either letting them fail (bad); nationalising them (plusbad); nationalising them and then letting them fail (as in N Rock or B & Bingley, doublebad); or bailing them out/propping them up with taxpayers' money (doubleplusbad). There's a simple, old fashioned solution to all this. M'learned colleague Prof Willem Buiter explained the merits of the debt-for-equity-swap on his FT 'blog. I, humble bean counter, did a worked example based on the Bradford & Bingley, just to show what this means in practice.