German Banks Need $175 Billion

From Reuters:

Germany’s 10 biggest banks need 127 billion euros ($175 billion) of additional capital, German newspaper Frankfurt Allgemeine Sonntagszeitung reported, citing a study by economic research institute DIW.

The paper on Sunday cited Dorothea Schaefer, research director for financial markets at DIW, as saying the ratio of banks’ equity capital to balance sheet total needs to rise to at least 5 percent.

A source said this month that the International Monetary Fund has estimated European banks overall could face a capital shortfall of 200 billion euros…

And from what I’ve heard, German banks are the healthy ones…you get to France and Spain and you start to find banks with really bad finances.

Bail outs and free money and borrowing and printing…all to keep Greece from defaulting and thus spinning the Eurozone down to destruction.  And what has it all accomplished?  Greece is still going to default (in a real sense, Greece already has…but the official announcement hasn’t been made by the Ruling Class, therefor the MSM doesn’t admit it, either) and once-stable economies – like Germany’s – are also being ruined.  All they did was throw good money after bad…it would have been better if Greece had defaulted two years ago.  Just as it would have been better if back in 2008 no one had stepped in to “save” the global financial system.  Sure, it stopped a Great Depression…but only for a little while.  We’re still going to get one.

It would be the irony of ironies if Germany’s financial plight proved the final trigger for the collapse.  The Germans – with long memories of pre-WWII financial troubles – kept their financial house in order.  To be sure, Germany’s welfare State is just as unsustainable as any in Europe, but at least the German’s had a handle on it…and Germans remain highly productive workers so they are at least generating wealth to pay their bills.  Not so in the rest of Europe…elsewhere, you do have the welfare State (often more generous than Germany’s) but without anyone willing to do any hard work, at all.  Now Germany threw her weight behind the irresponsible European Union members and will pay a price for being generous rather than realistic. The really bad news is that if Europe does fall apart, I bet dollars to donuts that the lazy parts of Europe will blame Germany…welfare bums don’t like it when the spigot is cut off and they tend to blame those who hold down a job.

HAT TIPMish’s

One thought on “German Banks Need $175 Billion

  1. gustav December 3, 2011 / 3:01 pm

    I agree, Germany is realizing that they were in error by lending directly to Greece. The bloody unions there are trying to justify their existance and will do anything to stop any type of austerity measure. Germany’s latest push of loaning funds to the IMF so they can loan to troubled countries, will eventually pull in the US when those loans go into default…and they definately will. What will happen if Italy hits the fan? They spend money there like a drunken sailor and have no conception how to stop. You called the lazy above welfare bums and you are being kind. I call them parasites!

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