asterisk2a + bundesbank   37

The Deutsche Bank crisis could take Angela Merkel down – and the Euro
Over the weekend, the German Chancellor Angela Merkel waded into the mess, briefing that there could be no government bail-out of the bank. [...] If it was in trouble, it was on its own. [... would be another example of socialism for the rich, and the poor must suffer waht they must - varoufakis ]

But hold on. Surely that is an extra-ordinary decision? If the German government does not stand behind the bank, then inevitably all its counter-parties – the other banks and institutions it deals with – are going to start feeling very nervous about trading with it.
Angela  Merkel  bailout  Deutsche  Bank  Italy  contagion  TBTF  systemic  risk  investment  banking  Germany  Bundesbank  ECB  AfD  CDU  CSU  SPD  far-right  right-wing  austerity  Commerzbank  bail-in  bailin 
september 2016 by asterisk2a
Bundesbank head Jens Weidmann - Brexit is no excuse to loosen EU budget rules
Reuters report that this puts Weidmann at odds with German Economy Minister Sigmar Gabriel, who has called for Europe's "Stability and Growth Pact" to be boosted for more growth.
-
So, we've got a politician wanting to spend more.
And the head of the Buba saying "No!"

Same old :-D //&! http://news.forexlive.com/!/germany-will-stick-to-balanced-budget-report-20160701
lost  decade  Brexit  fiscal  stimulus  fiscal  policy  BuBa  Bundesbank  ECB  MarioDraghi  trichet  Angela  Merkel  austerity  budget  deficit  Germany  Pact  Schuldenbremse  Wolfgang  Schäuble  liquidity  trap  Mark  Blyth  economic  history  inflation  targeting  inflation  expectation  inflation  expectations  recovery  Jens  Weidmann  monetary  policy  global  economy  Schwarze  Null  Exportweltmeister  Beton  Gold  Betongold  ZIRP  NIRP  QE  distortion  Richard  Koo  European  Union  zombie  bank  zombie  banks  NPL  PIGS  non-performing  loan  underinvestment 
july 2016 by asterisk2a
What Happens Next (In Europe)?
the odds of another crisis are higher than a rally to fresh records. [...]
“The 2009-2015 rally originated from two main drivers: a massive stimulus, and credit expansion in China,” said Goette, who’s a partner at his firm in Zug, Switzerland and helps oversee 1 billion Swiss francs ($1 billion).

“European earnings have not followed suit so far. Skepticism regarding central-bank operations has started to emerge.”
ECB  Brussels  recovery  reflate  reflation  China  credit  bubble  Germany  PIGS  zombie  banks  European  Bank  Supervision  European  Economic  Area  European  Election  2014  working  poor  squeezed  middle  class  Soziale  Marktwirtschaft  MarioDraghi  OMT  LTRO  monetary  policy  monetary  stimulus  Fiscal  Pact  Schuldenbremse  sovereign  debt  crisis  France  Brexit  Grexit  Angela  Merkel  Wolfgang  Schäuble  history  underinvestment  Richard  Koo  Yanis  Varoufakis  liquidity  trap  zombie  corporations  youth  unemployment  demographic  bubble  OAP  discretionary  spending  disposable  income  liberal  reform  Precariat  precarious  employment  low  pay  low  income  Minijob  Zeitarbeit  Leiharbeit  1  Euro  Job  Structural  Impediments  imbalance  unemployment  monetary  transmission  mechanism  monetary  union  union  Rechtsruck  Bundesbank  fault  lines  shareholder  capitalism  bailout  GFC  2016  PBOC  Exportweltmeister  zombie  Financial  Stability  Board  crony  capitalism  Deutsche  Bank  infrastructure  investment  competitiveness  Beton  Gold  Betongold  asset  allocation  Super  Rich  1%  oligarchy  plutocracy  democracy  tax  evasion  tax  avoidance  Wall  Street  shareholder  value  profit  maximisation  profit  maximization  Russia  Crimea  Ukraine  U 
april 2016 by asterisk2a
Migrant crisis: Germany's 'rock of stability' in danger - BBC News
[ has to invest massively to integrate people and not put them aside on Hartz-IV. leeway to borrow money for nothing is there. political will to break the dogma and ideology of austerity, schwarze null, schuldenbremse has to be there. across europe! ] The migrant crisis could see Germany losing its position as a "rock of stability", a former European Central Bank chief economist has told BBC HARDtalk. Otmar Issing warned the growing "fiscal burden" over the numbers of people arriving could completely change the country's economy.
refugee  crisis  migration  immigration  economic  refugee  Asylbewerber  Asylum  Sozialpolitik  Integrationspolitik  Schuldenbremse  Fiscal  Pact  education  policy  underinvestment  budget  deficit  hartz-iv  ALG2  Aufstocker  Fachkräftemangel  Ausländerfeindlichkeit  Xenophobia  racism  Rechtsextremismus  Rechtsruck  Angela  Merkel  Wolfgang  Schäuble  labour  economics  labour  market  labour  laws  minimum  wage  Niall  Ferguson  youth  unemployment  competitiveness  competitive  Germany  STEM  industrial  policy  European  Union  Bundesbank  ECB  public  sentiment  public  awareness  war  refugee  Afghanistan  Irak  Iraq  Syrien  Syria 
february 2016 by asterisk2a
Vickers warns over weaker bank safety buffers - BBC News
[ no skin in the game ] The man charged with leading an inquiry into the future safety of Britain's banks has said Bank of England plans are not strong enough. Sir John Vickers, who led the Independent Commission on Banking (ICB) said: "The Bank of England proposal is less strong than what the ICB recommended." In a BBC interview, he added "I don't think the ICB overdid it." The Bank of England declined to comment. Specifically, it is the plans to make sure that banks have enough capital that Sir John has questioned. Capital is considered vital to a bank's safety, as it serves to protect it from sudden losses. It comes in many forms, but the most common is funding from shareholders, who expect a hefty return on the risk they are taking. The backdrop to this news is the current slump in bank share prices across Europe. Since the start of the year, European banking stocks have lost a quarter of their value. //&! bit.ly/1Xs0Bac
zombie  banks  retail  banking  investment  banking  toobigtofail  too  big  to  jail  TBTF  too  big  to  bail  economic  history  lobbyist  lobby  Lobbying  GFC  speculation  CDS  CDO  derivatives  Interestrateswap  financial  product  VAR  risk-management  risk  management  Greed  bonuses  bonus  financial  crisis  blackswan  Black  Swan  Career  Politicians  No  Representation  democracy  Super  Rich  1%  plutocracy  oligarchy  Wall  Street  shareholder  value  profit  maximisation  short-termism  self-regulation  regulation  deregulation  regulators  Glass-Steagall  BOE  ECB  Bundesbank  sovereign  debt  crisis  Fed 
february 2016 by asterisk2a
The new European Union | Credit Writedowns
[ EU banking system was too big to bail in case Greece and else would default even in parts on some of its debt and or make no or delay repayment with interest in full ] In conclusion, the conditions asked of Greece are not likely to be met, because they cannot be met. Greece will be blamed for not living up to its commitments, as it has been this time around. Yet, somehow, the notion of asking for the impossible from a country that has no choice but to sign is fundamentally perverse. [...] The mistake was to break the no-bailout clause that was designed to make sure the Eurozone would not find itself in this position. For selfish reasons (i.e. preventing a bank crisis in Europe and the US), Greece was convinced to accept the first bailout in 2010.
Greece  bank  bailout  banking  crisis  bank  crisis  investment  banking  retail  banking  TBTF  too  big  to  jail  too  big  to  bail  European  Union  Positioning  ECB  Career  Politicians  lobbyist  lobby  Lobbying  crony  capitalism  corporate  scandal  austerity  accounting  scandal  bailout  bail-in  Cyprus  of  Cyprus  deposit  haircut  deposit  levy  fairness  Generationengerechtigkeit  Wall  Street  profit  maximisation  shareholder  value  economic  history  fiscal  policy  monetary  policy  Basel3  banking  fractional  reserve  banking  EuropeanSystemicRiskBoard  GFC  recovery  Debt  Super  Cycle  Privatisation  ideology  dogma  PIIGSFB  PIGS  PIIGS  France  Germany  Bundesbank  trichet  Jens  Weidmann  Angela  Merkel  Peer  Steinbrück  corruption  blackmail  josefackermann  ackermann  Deutsche  subsidies  subsidizing  Mark  Blyth  social  contract  social  tension  social  cohesion  constituency  Nationalizing  badbank  badbanks  restructuring  monetary 
october 2015 by asterisk2a
Merkel's Leadership Has Failed in the Greece Crisis - SPIEGEL ONLINE
[ "Alternativlos." ] Angela Merkel relishes her reputation as queen of Europe. But she hasn't learned how to use her power, instead allowing a bad situation to heat up to the boiling point. Her inability to take unpopular stances badly exacerbated the Greek crisis. // &! bit.ly/1f8B8lY - Kein Unterschied, ob "Bild", "Zeit" oder ARD: In den deutschen Medien schwingen sich Journalisten reihenweise zu pöbelnden Parteigängern auf, statt Fakten und Analysen zur Griechenlandkrise zu bringen.
debt  jubilee  haircut  Grexit  Greece  PIGS  sovereign  debt  crisis  Angela  Merkel  Leadership  Career  Politicians  Germany  political  error  political  economy  political  science  political  folly  short-term  thinking  short-term  view  European  Union  IMF  ECB  BuBa  Bundesbank  Jens  Weidmann  MarioDraghi  ChristineLagarde  Jean-Claude  Juncker  France  unintended  consequences  unknown  unkown  complexity  ideology  dogma  manufactured  consent  corporate  state  bailout  solidarity  Gesellschaft  history  economic  history  austerity  Schuldenbremse  Fiscal  Pact  policy  folly  policy  error  GFC  recovery  sovereignty  Lügenpresse  media  conglomerate 
july 2015 by asterisk2a
Griechenland: Was Angela Merkel noch alles angeboten hat - SPIEGEL ONLINE
Für den Fall, dass Tsipras die Verlängerung des aktuellen zweiten Hilfspakets zu den veränderten Konditionen akzeptiert hätte, bot Merkel ihm dem Vernehmen nach in einem letzten Gespräch am Freitag vergangener Woche unter anderem Folgendes an: ein drittes Hilfsprogramm, Schuldenerleichterungen, also eine teilweise Umschuldung, Investitionen in Höhe von rund 35 Milliarden Euro. // BUT NO debt jubilee/haircut and admitting that it was a EU bank bailout through the back door. // Counter-off on day 0 from Syriza; ESM to take on debt for two years. Another delay. Country will NOT start to grow in two years to pay off EFSF and IMF ... bit.ly/1Nsrupr &! IMF pushes back on default scenario - bit.ly/1NsrpSz &! Germany paid 85bn to EU banks (aka Greece Debt payments via EFSF, IMF and ECB ELA liability and bonds that ECB bought via their bank refinance programms (LTRO) via BuBa capital ownership of ECB) in case of default - bit.ly/1Hrx4ra // &! bbc.in/1Knh8qM &! bbc.in/1Knh8qM
Grexit  default  IMF  EFSF  Angela  Merkel  PIGS  Wolfgang  Schäuble  European  Union  Career  Politicians  economic  history  sovereign  debt  crisis  zombie  banks  GFC  recovery  Great  Depression  Greece  austerity  Troika  ECB  Syriza  democracy  solidarity  political  error  political  economy  political  folly  policy  error  policy  folly  ESM  ELA  BuBa  Bundesbank  LTRO  TLTRO  MarioDraghi  Jean-Claude  Juncker 
june 2015 by asterisk2a
DIW-Chef Fratzscher zu Banken-Stresstest, Lohnerhöhung - SPIEGEL ONLINE
Die Abhängigkeit zwischen Banken und Staaten hat in den letzten Jahren besorgniserregend zugenommen. Die berechtigte Sorge ist daher, dass Bankenrettungen die Staatshaushalte der hochverschuldeten Eurostaaten überfordert. Dann könnten wir leicht wieder in eine Krisensituation wie im Sommer 2012 geraten, als die Anleihezinsen für viele Eurostaaten drastisch nach oben geschossen sind. [...] Die größte Herausforderung für Europa ist, Wachstum zu schaffen. Nur durch ein deutlich stärkeres Wachstum kann es gelingen, dass die Unternehmen Beschäftigte einstellen, die Banken faule Kredite abbauen und die Staaten ihre Finanzen in Ordnung bringen. [...] [ +see end - Income Growth across the board in Germany Needed. Recent 2017 wage floor/minimum wage was overdue. Overdue. ]
GDP  Europe  zombie  banks  PIGS  NPL  non-performing  loan  balance  sheet  recession  debtoverhang  Richard  Koo  Japan  economic  history  debt  jubilee  lost  decade  lost  generation  Super  Cycle  ECB  liquidity  trap  history  GFC  greatrecession  greatdepression  2014  infrastructure  investment  underemployed  structural  unemployment  long-term  unemployment  youth  unemployment  unemployment  Germany  France  faultlines  Impediments  structural  imbalance  structural  deficit  budget  deficit  fiscal  deficit  tradedeficit  trade  deficit  academia  academics  policy  error  policy  folly  fiscal  policy  monetary  policy  ZIRP  NIRP  OMT  QE  monetary  transmission  mechanism  deleveraging  Politics  Career  Politicians  ownership  accountability  transparency  Bundesbank  BuBa  income  growth  minimum  wage  wage  floor  coldprogression  kalte  Progression 
july 2014 by asterisk2a
EZB senkt Leitzins und beschließt Minuszinsen für Banken - SPIEGEL ONLINE
Die Europäische Zentralbank (EZB) hat ihren Leitzins auf ein Rekordtief gesenkt und erstmals einen negativen Einlagensatz beschlossen. Angesichts der zuletzt sehr niedrigen Inflationsrate wird der Zins, zu dem sich die Geschäftsbanken bei der Notenbank Geld leihen können, um 0,10 Punkte auf 0,15 Prozent gesenkt, wie die EZB am Donnerstag nach ihrer Ratssitzung in Frankfurt mitteilte. Der Einlagensatz, zu dem Banken kurzfristig Geld bei der Notenbank parken können, wird erstmals in den negativen Bereich gedrückt. Er sinkt von bisher null Prozent auf minus 0,10 Prozent. Der Zins für kurzfristige Ausleihungen bei der Notenbank vermindert sich von 0,75 auf 0,40 Prozent. + http://www.spiegel.de/wirtschaft/unternehmen/ezb-entscheidung-kredite-und-senkung-des-leitzins-a-973657.html ""Die Banken leiden nicht unter vermeintlich zu hohen Notenbankzinsen, sondern unter dem hohen Bestand fauler Kredite, an dem Negativzinsen nichts ändern." + !! http://youtu.be/kKO_yxP3dyQ !!
deflation  deflationary  monetary  transmission  mechanism  unconventional  monetary  policy  monetary  policy  macroprudential  policy  macroeconomics  macroeconomic  policy  ECB  MarioDraghi  BuBa  Bundesbank  2014  ZIRP  OMT  QE  debt  monetization  debt  monetisation  deposit  levy  New  Normal  financial  repression  zombie  banks  zombie  corporations  Super  Cycle  sovereign  debt  crisis  PIGS  Structural  Impediments  deficit  unemployment  imbalance  Europe  Germany  faultlines  recovery  policy  error  policy  folly  Makers  Career  Politicians  austerity  fiscal  policy  GFC  lost  decade  lost  generation  long-term  unemployment  banking  union  creditcrisis  creditcrunch  credit  crunch  2015  NPL  non-performing  loan  economic  history  LTRO  assetbackedsecurities  Sterilization 
june 2014 by asterisk2a
Dax knackt 10.000 Punkte: Rekord wegen billigen Gelds von EZB - SPIEGEL ONLINE
Erstmals überspringt der Dax die Marke von 10.000 Punkten. Das beweist erneut, wie sehr der deutsche Leitindex vom billigen Geld der Notenbank abhängig ist - und wie schnell die gute Stimmung an der Börse vorbei sein kann. + http://www.spiegel.de/wirtschaft/unternehmen/dax-steigt-ueber-10-000-punkte-auf-neuen-rekordstand-a-972849.html + http://www.spiegel.de/wirtschaft/unternehmen/geldanlage-bei-niedrigzinsen-gold-immobilien-einen-jaguar-a-973671.html ""Wohin also jetzt mit den Ersparnissen?"" +++ Spekulationsblasen: Wirtschaftsweiser warnt vor Gefahren der Niedrigzinsen - http://www.spiegel.de/wirtschaft/ezb-wirtschaftsweiser-wieland-warnt-vor-spekulationsblasen-a-975400.html +++ Niedrigzinsen: Schäuble befürchtet Immobilienblase in Deutschland - http://www.spiegel.de/wirtschaft/soziales/zinsen-schaeuble-befuerchtet-immobilienblase-in-deutschland-a-976154.html
asset  bubble  Betongold  Beton  Gold  ZIRP  QE  OMT  ECB  BOE  BOJ  Fed  monetary  policy  unconventional  monetary  policy  monetary  stimulus  asset  allocation  property  bubble  London  PIGS  monetary  transmission  mechanism  liquidity  trap  liquidity-trap  zombie  consumer  zombie  corporations  zombie  banks  Europe  sovereign  debt  crisis  Super  Cycle  hunt  for  yield  New  Normal  financial  repression  2014  MarioDraghi  BuBa  Bundesbank  banking  union  unintended  consequences  unknown  unknowns  complexity  macroprudential  policy  Politics  Career  Politicians  policy  folly  policy  error  austerity  fiscal  policy  Structural  Impediments  unemployment  faultlines  imbalance  recovery  greatdepression  greatrecession  lost  decade  lost  generation  speculative  bubbles  equity  bubble  credit  bubble  debt  bubble  bond  bubble  Wolfgang  Schäuble 
june 2014 by asterisk2a
Bond Yields Lowest Since Napoleon Are No Comfort to Europe Amid Deflation Fight - Businessweek
Germany issued 5yr bond with a yield of .45%, last year same type of issue was arount the .3% mark. OUCH, way below inflation. - "" “The outright level of yields is suggesting an incredibly weak outlook for growth,” “It’s a powerful signal telling you policy is too tight and that there’s complacency toward the risks. Not a great deal has been solved. We’ve still got bank stress tests to come, too low growth and too low inflation.” ""
deflation  deflationary  ECB  unconventional  monetary  policy  modern  monetary  theory  monetary  transmission  mechanism  monetary  stimulus  monetary  policy  debt  monetization  debt  monetisation  sovereign  debt  crisis  PIGS  Super  Cycle  faultlines  Structural  Impediments  imbalance  unemployment  long-term  unemployment  youth  unemployment  unemployment  hunt  for  yield  ZIRP  OMT  QE  economic  history  recovery  GFC  greatrecession  greatdepression  2014  MarioDraghi  BuBa  Bundesbank  fiscal  policy  Career  Politicians  Politics  Germany 
june 2014 by asterisk2a
Bundesbank Open to Significant ECB Stimulus in June if 2016 Inflation Forecasts Lowered - WSJ.com
BuBa  Bundesbank  ECB  unconventional  monetary  policy  monetary  transmission  mechanism  monetary  system  monetary  policy  monetary  theory  sovereign  debt  crisis  Super  Cycle  PIGS  recovery  2014  ZIRP  OMT  negative  real  interest  rate  NIRP  monetary  stimulus  stimulus  economic  history  deflation  deflationary  nominal  GDP  targeting  inflation  targeting  long-term  unemployment  structural  imbalance  Impediments  structural  unemployment  Europe  Career  Politicians  IMF  MarioDraghi  participation  rate  productivity  Germany  unintended  consequences  unknown  unknowns  asset  bubble  hunt  for  yield  speculative  bubbles  structural  deficit  negative  deposit  rate  deposit  facility  overnight  deposit  facility 
may 2014 by asterisk2a
Politik der niedrigen Zinsen: Nordstaaten verhinderten Zinssenkung - SPIEGEL ONLINE
Die Geldpolitiker der Nordländer in der EU beharren auf ihrer Linie: Gemeinsam verhinderten Bundesbank-Präsident Weidmann und seine Kollegen nach SPIEGEL-Informationen eine weitere Leitzinssenkung der EZB. [...] Doch sieben Ratsmitglieder, vor allem aus den Nordstaaten, argumentierten heftig dagegen. Darunter waren nicht nur der deutsche Bundesbank-Chef Jens Weidmann und der Niederländer Klaas Knot, sondern auch das deutsche Mitglied des geschäftsführenden Direktoriums, Jörg Asmussen.
QE  NIRP  JörgAsmussen  Europe  creditcrunch  M3  Bundesbank  monetary  transmission  mechanism  liquidity-trap  ZIRP  Jens  Weidmann  negative  real  interest  rate  banking  crisis  ECB  bank  crisis  creditcrisis 
july 2013 by asterisk2a
Texas Wants Its Gold Back - YouTube
Texas State, introduces legislation that State Gov can't seize its Gold. Also plans to relocate its Gold from NYFed to Texas. Germany already announces (via Bundesbank) that its Gold (held @ NY Fed) will be shipped to the Bundebank. All is the same tone of Cyprus bail-in.
bail-in  currency  debasement  economic  history  Cyprus  currency-war  Gold  Bundesbank 
april 2013 by asterisk2a
Lest We Forget | ZeroHedge
The view of the ECB raises some interesting questions. I believe most would agree on two issues; first that the ECB is an insolvent institution and so highly leveraged and under-capitalized that a normal bank would have been in bankruptcy long ago but then a normal bank can’t print money. However it must also be said that the ECB is not a stand-alone institution living on another world and that the national central banks of Europe own it. Second I think most thoughtful people would agree that at some point in time that the financial condition of a central bank matters either in terms of increasing inflation by increasing the money supply or as a matter of valuation if no one or not enough financial institutions will support their currency or if some national central bank opts out on the basis of the economic threat to its citizens. This could be exemplified by Germany.

... The game could end if a major European bank falters
... Loss of Trust = Out of Bonds/Equity - into Gold&Co;.
Jens  Weidmann  Mark  Grant  operationtwist  QE3  QE2  OMT  SMP  greatrecession  GFC  unintended  consequences  Fed  ZIRP  QE  Gold  toobigtofail  confidence  trust  bank  crisis  banking  crisis  debt  monetisation  monetization  PIIGS  sovereign  debt  crisis  Europe  Germany  Bundesbank  MarioDraghi  economic  history  monetary  theory  monetary  policy  balancesheet  accounting  ECB 
october 2012 by asterisk2a
EZB-Juristen prüfen Anleihen-Aufkaufprogramm - SPIEGEL ONLINE
Betreibt die Europäische Zentralbank mit ihrem Aufkaufprogramm für Anleihen versteckte Staatsfinanzierung? Offenbar wappnen sich die Währungshüter gegen diesen Vorwurf. Laut "Bild"-Zeitung prüfen Juristen von EZB und Bundesbank die Rechtmäßigkeit der Käufe.

Nicht ausgeschlossen wird dem Bericht zufolge dabei, dass die brisante Frage demnächst dem Europäischen Gerichtshof zur Klärung vorgelegt wird. Für diesen Fall wollten sich EZB und Bundesbank juristisch wappnen. Hintergrund sei der Streit um die Frage, ob die EZB mit den Aufkäufen gegen das EU-vertragliche Verbot von direkter Staatsfinanzierung verstoße.
Europe  sovereign  debt  crisis  PIIGS  ECB  Jens  Weidmann  Bundesbank  2012  monetary  policy  monetarism  monetization  OMT 
september 2012 by asterisk2a
EZB: Ankündigung von Draghi zum Anleihenkauf enttäuscht Anleger - SPIEGEL ONLINE
ECB loading up on sovereign debt (PIIGS + France, Belgium) poses a balance sheet risk if just one country Defaults outright and or even imposed just a haircut even for ECB [ECB demanded and pulled through this demand to take no haircut in the Grecce's partial default/PSI 2011].

Meaning then that the ECBs balance sheet is under water and thus the National Central Banks of each country within the EMU have to raise money via its respective governments on debt markets (which are likely then closed because of the severity of the situation, meaning they have to sell their reserve holding of foreign currencies and assets) and without appropriate funds ... Europe's sovereign debt crisis once defined to the south would likely turn into an outright currency crisis.

Baseline: Open Market Operations (SMP) by the ECB have massive tail risk, unintended consequences for the ECB, the monetary system, price stability, the Euro.
ZIRP  QE  SMP  bank  crisis  banking  crisis  greatrecession  GFC  currency-war  currency  debasement  default  Greece  policy  folly  policy  error  2012  Europe  blackswan  confidence  trustagent  trust  tail  risk  Euro  creditcrunch  Monetary  System  theory  policy  sovereign  debt  crisis  PIIGS  Jens  Weidmann  MarioDraghi  Bundesbank  ECB 
august 2012 by asterisk2a
Why Germany's TARGET2-Based Eurozone Preservation Mechanism Is Merely A Ticking Inflationary Timebomb | ZeroHedge
Who ultimately pays for TARGET2 losses? Higher inflation part of the bill
...
[T]he important point in the context of the financial risk for Germany from the growing TARGET2 imbalances is that, in the event of a break-up of the Euro area, the price paid would not necessarily be in the form of a massive recapitalisation of the Bundesbank, which could endanger the solvency of the German government itself. Rather, it would come in the form of higher inflation, as Germany faced the financial costs of the Bundesbank’s rising net claims vis-à- vis the other Euro area central banks.

...

Pulling all these data together, we can see a clear shift in the composition of Germany’s net foreign asset position: financial institutions have sharply reduced their exposure to the periphery , while the public sector has increased its claims significantly. The main channel through which this transfer of risk has taken place has been the TARGET2 system.
BIS  Bundesbank  ECB  inflation  greatrecession  GFC  PIIGS  2012  EMU  Europe  sovereign  debt  crisis  Germany  target2-system 
july 2012 by asterisk2a
Bundesbank’s Weidmann Says What No Politician Wants to Hear - Bloomberg
“Monetary policy is not a panacea and central bank firepower is not unlimited, especially not in a monetary union,” he said. “We can only win back confidence if we bring down excessive deficits and boost competitiveness. And it is precisely because these things are unpopular that makes it so tempting for politicians to rely instead on monetary accommodation.”
Weidmann hasn’t spared Draghi or Merkel, who has vowed to prevent a breakup of the currency union and put the most money on the line for bailouts and financial backstops.
When European leaders agreed on the fiscal compact championed by Merkel in late January, Draghi said it was “the first step toward the fiscal union” and would “strengthen confidence in the euro area.”
Weidmann said it fell short.
“Obviously in the negotiations, as often in the past, things were watered down,” he said on Feb. 1. “It’s clear that the cornerstone for a real fiscal union hasn’t been laid here.”
PIIGS  sovereign  debt  crisis  policy  error  policy  folly  politics  angelamerkel  Europe  EMU  ECB  monetary  policy  Bundesbank  Jens  Weidmann 
june 2012 by asterisk2a
Germany’s economy: Message to the Bundesbank | The Economist
Bundesbank and BaFin could with domestic policy tools (“macroprudential” instruments) avoid asset bubbles (ie property, agriculture land bubble, excessive debt growth). Spurred via QE/LTRO and ZIRP.

"To do that, he has two tools: the bully pulpit and so-called macroprudential levers, such as requiring banks to boost their capital or tightening rules on mortgages. Like many other countries, Germany is developing rules that will allow its central bank and financial supervisors to dampen credit and asset bubbles (see article)."

[...]

ECB/BaFin have to put Germany’s inflation in context: higher wages, after years of stagnation, are a good thing. And he must squash alarmist talk about asset bubbles. Yes, German property prices have started to rise, but it is hardly a bubble when house prices, relative to incomes and rents, are around 20% undervalued.

http://www.economist.com/node/21554198
Germany  2012  sovereign  debt  crisis  Europe  monetary  policy  inflation  reflation  competitiveness  PIIGS  unintended  consequences  LTRO  QE  ZIRP  ECB  bafin  bundesbank 
may 2012 by asterisk2a
How Much Bigger Can TARGET2 Imbalances Grow? Goldman Answers: "A Lot" | ZeroHedge
"how much more can the TARGET2 imbalances increase?" The scientific and, non-scientific answer, comes from Goldman Sachs: "a lot."

Uh, of course we are talking about a euro breakdup: if Goldman does not understand this, they need to plant at least another head of a central bank in addition to the ECB: namely the Bundesbank. Because the question is just what the bill to the German taxpayers will be when everything falls apart, up to and including the euro. And that question Goldman was already kind enough to answer: "a lot"
2012  bundesbank  ECB  Germany  PIIGSFB  PIIGS  europe  sovereign  debt  crisis  target2-system 
april 2012 by asterisk2a
Finanzkrise: "Die Märkte schreien nach immer mehr Geld" - SPIEGEL ONLINE - Nachrichten - Wirtschaft
Nagel: Wir müssen aufmerksam beobachten, was mit dem Geld passiert. Noch parken die Institute einen Großteil bei den Notenbanken, aber dafür bekommen sie nur 0,25 Prozent Zinsen. Da sie selbst ein Prozent Zinsen bezahlt haben, ist das für sie auf Dauer ein schlechtes Geschäft. Es besteht also die Gefahr, dass die Banken Risiken eingehen, die wir eigentlich nicht sehen wollen. Für uns ist deshalb wichtig, dass wir jetzt schon über Ausstiegsszenarien reden und den Märkten signalisieren: Es ist nicht selbstverständlich, dass es so wie in den letzten Monaten weitergeht.

-- Don't get Banks addicted to easy money. Hard choices for the future have to be made.
monetary  policy  QE  ZIRP  LTRO  bundesbank  ECB 
march 2012 by asterisk2a
Mario Draghi Is Becoming Germany's Most Hated Man | ZeroHedge
The huge take-up at Wednesday's so-called LTRO meant that in the space of two months the ECB has injected over a trillion euros into the financial system.

- liquidity does not solve insolvency.
- may buy time, but also prone to wreak havoc

But, but, it's all in the name of perpetuating the ponzi. Forget that it is the Germans who are paying the bill.

Draghi is already at odds with some powerful voices in Germany, taking a nonchalant view last month about the TARGET2 imbalances.

The Bundesbank considers the TARGET2 imbalances a symptom of underlying problems in the currency bloc and is watching them with increasing concern as they reflect a stronger reliance of banks in weaker euro zone countries on cheap ECB funding and growing risks on those countries' central banks balance sheets.
reflation  inflation  target2-system  MarioDraghi  bundesbank  Europe  structural  imbalance  ZIRP  unintended  consequences  quantitative-easing  QE  monetary  policy  ECB  2012  LTRO 
march 2012 by asterisk2a
Euro-Krise: Vier tickende Geldbomben bedrohen Europa - SPIEGEL ONLINE - Nachrichten - Wirtschaft
1. ECB's LTRO does not solve sovereign debt problem
2. Greece
2.5 Portugal
3. Spain
4. Europe's National Central Banks seem to go under .... Target2; ECB's interbank payment system.

http://www.ecb.int/paym/t2/html/index.en.html
http://en.wikipedia.org/wiki/TARGET

"Für die Bundesbank ergeben sich daraus Forderungen von fast einer halben Billion Euro gegenüber der EZB, eine Summe, die mit jedem Monat der Krise weiter wächst."

http://www.cesifo-group.de/portal/pls/portal/docs/1/1207364.PDF

http://www.zerohedge.com/news/goldmans-take-target2-and-how-bundesbank-will-suffer-massive-losses-if-eurozone-fails
PIIGS  Germany  sarkozy  angelamerkel  politics  political  economy  bundesbank  ECB  faultlines  structural  imbalance  target2-system  Spain  economic-thought  balance  sheet  recession  richardkoo  Greece  LTRO  2012  sovereign  debt  crisis  Europe 
february 2012 by asterisk2a
Goldman's Take On TARGET2 And How The Bundesbank Will Suffer Massive Losses If The Eurozone Fails | ZeroHedge
However, central banks in the core countries face one specific risk that can be traced back to the TARGET2 imbalances, and this refers to the possibility that a country might decide to leave the Euro area. In such a scenario, the net claims the remaining central banks have acquired vis-à-vis that country reflect a genuine risk that would not exist without these imbalances. This could in the extreme case of a total break-up of the Euro area, and assuming that the peripheral central banks could not repay their liabilities, mean that the losses would materialise on the Bundesbank’s balance sheet.

It is only if one or several countries were to decide to leave the Euro area that the imbalances would lead to potentially significant losses beyond the risk already reflected in the current generous liquidity provision through the ECB.
ECB  2011  bundesbank  Europe  EMU  break-up 
december 2011 by asterisk2a
Falsche Strategie gegen Finanzkrise: Siegeszug der Zombie-Banken - SPIEGEL ONLINE - Nachrichten - Wirtschaft
"Im Krisenjahr sollten die Gewinne verhaftet werden"

Gänzlich überflüssig seien solche Worte, schallte es sogleich aus den Bankentürmen. Andreas Schmitz, Chef der Trinkaus-Bank und, immerhin, Präsident des Deutschen Bankenverbands, konnte seine Empörung nur mühsam zügeln. "Es ist die ureigenste Pflicht eines Vorstands, selbst zu erkennen, wenn er Gewinne einbehalten sollte", ließ er sich zitieren. "Da braucht er keinen Hinweis von Herrn Professor Weber."
Axelweber  josefackermann  zombi  banks  banking  bonuses  soffin  bafin  bundesbank  reform 
october 2009 by asterisk2a

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