European Banking Crisis

[meom]

You clearly did not notice a few points, This wek their was a summit in Shangai between the Asean countries and the EU countries. The US was not invited?

This year already 16 US banks went banckrupt. In the EU non.

All your financial institutes and major banks have major Arab and Chinese investors. Not any EU country have such a high foreign debt as the US. GM is planned to send 100 000 workers home.

Not any EU have such a negative trade balance as the US.

The US is like that poor noble man who don't have a peny to spare but is the bully of the class and still have the arrogance to thinks that hes god's gift to earth.

You are quite envious of the US financial strength. You brag that EU doesn't have nearly the foreign debt as the US and come to the conclusion that this is a strength. Countries could invest more in the EU, but they choose to invest in the US because of the perceived strength of the economy. You might be smarter than rest of global investors. I doubt it - you are just angry that America still is percieved as a safe haven during times like these. Also, I wonder why EU stock markets have performed worse than the US during this crisis.

Please let us all know why EU is better positioned than the US to weather this financial crisis. The EU real estate bubble and extremely high leveraged banks will make your argument difficult. Also, unlike the US, EU holds not only toxic US mortgage debt, but also holds it own mortgage debt. If you feel EU isn't going to have its own mortgage meltdown, you're wrong.

When this all over, EU is going to suffer more than the US. At least that what international investors are betting on over the last few months. All you need to do is follow the money to come to this conclusion.

Europe will be in for a rough ride considering that Western European banks account for about three quarters of the total $4.7 trillion in cross border bank loans to Eastern Europe, Latin America and Asia.

[quiksilva]

the last time the world went into a a slowdown and economic drop it resulted in WW2.

OH my god i sound just like bingo....

I'm expecting Obama to declare war on Great Britain, maybe on Canada too.

Actually if we do see a President Obama he will likely be declaring war shortly after ignauguration, primarily on China and European Union in the form of restictive trade policy! It will be the wrong move and will cause this crisis to last for many more years

Thats a frightening thought Vegas as that is exactly what happened in the 1930's, do you really think that could happen?

edit to include the following from Obama's website for reference

Trade

Obama and Biden believe that trade with foreign nations should strengthen the American economy and create more American jobs. He will stand firm against agreements that undermine our economic security.

* Fight for Fair Trade: Obama and Biden will fight for a trade policy that opens up foreign markets to support good American jobs. They will use trade agreements to spread good labor and environmental standards around the world and stand firm against agreements like the Central American Free Trade Agreement that fail to live up to those important benchmarks. Obama and Biden will also pressure the World Trade Organization to enforce trade agreements and stop countries from continuing unfair government subsidies to foreign exporters and nontariff barriers on U.S. exports.

* Amend the North American Free Trade Agreement: Obama and Biden believe that NAFTA and its potential were oversold to the American people. They will work with the leaders of Canada and Mexico to fix NAFTA so that it works for American workers.

* Improve Transition Assistance: To help all workers adapt to a rapidly changing economy, Obama and Biden will update the existing system of Trade Adjustment Assistance by extending it to service industries, creating flexible education accounts to help workers retrain, and providing retraining assistance for workers in sectors of the economy vulnerable to dislocation before they lose their jobs.

* End Tax Breaks for Companies that Send Jobs Overseas: Barack Obama and Joe Biden believe that companies should not get billions of dollars in tax deductions for moving their operations overseas. Obama and Biden will also fight to ensure that public contracts are awarded to companies that are committed to American workers.

* Reward Companies that Support American Workers: Barack Obama introduced the Patriot Employer Act of 2007 with Senators Richard Durbin (D-IL) and Sherrod Brown (D-OH) to reward companies that create good jobs with good benefits for American workers. The legislation would provide a tax credit to companies that maintain or increase the number of full-time workers in America relative to those outside the US; maintain their corporate headquarters in America if it has ever been in America; pay decent wages; prepare workers for retirement; provide health insurance; and support employees who serve in the military.

I suppose after reading that it could point to a policy direction such as you described but to what extent?

Edited October 27, 2008 by quiksilva

[cmsally]

the last time the world went into a a slowdown and economic drop it resulted in WW2.

OH my god i sound just like bingo....

I'm expecting Obama to declare war on Great Britain, maybe on Canada too.

Actually if we do see a President Obama he will likely be declaring war shortly after ignauguration, primarily on China and European Union in the form of restictive trade policy! It will be the wrong move and will cause this crisis to last for many more years

Thats a frightening thought Vegas as that is exactly what happened in the 1930's, do you really think that could happen?

edit to include the following from Obama's website for reference

Trade

Obama and Biden believe that trade with foreign nations should strengthen the American economy and create more American jobs. He will stand firm against agreements that undermine our economic security.

* Fight for Fair Trade: Obama and Biden will fight for a trade policy that opens up foreign markets to support good American jobs. They will use trade agreements to spread good labor and environmental standards around the world and stand firm against agreements like the Central American Free Trade Agreement that fail to live up to those important benchmarks. Obama and Biden will also pressure the World Trade Organization to enforce trade agreements and stop countries from continuing unfair government subsidies to foreign exporters and nontariff barriers on U.S. exports.

* Amend the North American Free Trade Agreement: Obama and Biden believe that NAFTA and its potential were oversold to the American people. They will work with the leaders of Canada and Mexico to fix NAFTA so that it works for American workers.

* Improve Transition Assistance: To help all workers adapt to a rapidly changing economy, Obama and Biden will update the existing system of Trade Adjustment Assistance by extending it to service industries, creating flexible education accounts to help workers retrain, and providing retraining assistance for workers in sectors of the economy vulnerable to dislocation before they lose their jobs.

* End Tax Breaks for Companies that Send Jobs Overseas: Barack Obama and Joe Biden believe that companies should not get billions of dollars in tax deductions for moving their operations overseas. Obama and Biden will also fight to ensure that public contracts are awarded to companies that are committed to American workers.

* Reward Companies that Support American Workers: Barack Obama introduced the Patriot Employer Act of 2007 with Senators Richard Durbin (D-IL) and Sherrod Brown (D-OH) to reward companies that create good jobs with good benefits for American workers. The legislation would provide a tax credit to companies that maintain or increase the number of full-time workers in America relative to those outside the US; maintain their corporate headquarters in America if it has ever been in America; pay decent wages; prepare workers for retirement; provide health insurance; and support employees who serve in the military.

I suppose after reading that it could point to a policy direction such as you described but to what extent?

Coincidence that was the subject of the last McCain speech I heard. How the Rep. would uphold the free market economy and how the Dem. would do everything they could to restrict and control.

[VegasVic]

the last time the world went into a a slowdown and economic drop it resulted in WW2.

OH my god i sound just like bingo....

I'm expecting Obama to declare war on Great Britain, maybe on Canada too.

Actually if we do see a President Obama he will likely be declaring war shortly after ignauguration, primarily on China and European Union in the form of restictive trade policy! It will be the wrong move and will cause this crisis to last for many more years

Thats a frightening thought Vegas as that is exactly what happened in the 1930's, do you really think that could happen?

edit to include the following from Obama's website for reference

Trade

Obama and Biden believe that trade with foreign nations should strengthen the American economy and create more American jobs. He will stand firm against agreements that undermine our economic security.

* Fight for Fair Trade: Obama and Biden will fight for a trade policy that opens up foreign markets to support good American jobs. They will use trade agreements to spread good labor and environmental standards around the world and stand firm against agreements like the Central American Free Trade Agreement that fail to live up to those important benchmarks. Obama and Biden will also pressure the World Trade Organization to enforce trade agreements and stop countries from continuing unfair government subsidies to foreign exporters and nontariff barriers on U.S. exports.

* Amend the North American Free Trade Agreement: Obama and Biden believe that NAFTA and its potential were oversold to the American people. They will work with the leaders of Canada and Mexico to fix NAFTA so that it works for American workers.

* Improve Transition Assistance: To help all workers adapt to a rapidly changing economy, Obama and Biden will update the existing system of Trade Adjustment Assistance by extending it to service industries, creating flexible education accounts to help workers retrain, and providing retraining assistance for workers in sectors of the economy vulnerable to dislocation before they lose their jobs.

* End Tax Breaks for Companies that Send Jobs Overseas: Barack Obama and Joe Biden believe that companies should not get billions of dollars in tax deductions for moving their operations overseas. Obama and Biden will also fight to ensure that public contracts are awarded to companies that are committed to American workers.

* Reward Companies that Support American Workers: Barack Obama introduced the Patriot Employer Act of 2007 with Senators Richard Durbin (D-IL) and Sherrod Brown (D-OH) to reward companies that create good jobs with good benefits for American workers. The legislation would provide a tax credit to companies that maintain or increase the number of full-time workers in America relative to those outside the US; maintain their corporate headquarters in America if it has ever been in America; pay decent wages; prepare workers for retirement; provide health insurance; and support employees who serve in the military.

I suppose after reading that it could point to a policy direction such as you described but to what extent?

This goes way beyond Obamas' personal views on trade! The Demacratic party in the U.S. has been hijacked by the far left wing nuts (the george soros moveon.org crowd), and they will be in control in both houses of Congress after this election and could possibly have a veto proof majority in the Senate (perhaps the scariest scenario I have ever though about short of nuclear war). The leaders of the Democratic party, Nancy Pelousy in the House and Harry Red in the Senate, are both left wingers and have a strong protectionist bent. I find it kind of odd that there is such support for Obama among the expats from countries outside of the U.S. on this board, because if Obama wins it could put a severe hurt on the exports that enter the U.S. , particularly from china and the E.U. Perhaps its just a case that those Europeans, Aussies, Canadians and Asians are reacting with emotions instead of actually thinking this thing out?

[henryalleman]

Laopo, you seems to my surprise well informed about the French talking Haute Finance mentallity in Belgium. I guess you mean the interferance of the King in the take over by Fortis of the "Generale bank" instead of ING and the take over of Sabena by Air France even SAS despite the fact that they made an better offer. But they prefer a sell out to France, as the rest of the Belgian crown jewels. The whole energy sector becalme in French hands also. In this light you must also see the reason for the attack an KBC (the biggest Flemish bank), wh is very solvable and have no financial problms at all. But their shares lost more than 20% in one day. For all of this and much more I'm not only a Fleming, but a Flemish Nationalist, who find it an insult to be called a Belgian.

As a matter of fact I was NOT talking about the King or his connection or not with the French Haute Finance.

I was talking about the former CEO's of Fortis like Maurice Lippens, Jean-Paul Votron and Herman Verwilst in a lesser role.

PS: you must feel very upset today (after writing the above words)....hearing about the ongoing negotiations today (Sunday October 26th) in Belgium between the Government and KBC about an injection of € 3.5 Billion in return for shares in KBC.

The bank itself is denying it's having problems.

If a solution isn't reached by Monday morning, trading in shares of KBC could be halted.

We'll see.

LaoPo

The only thing I'm upset about is the fact that midst July 1 EURO= 53 Baht and today only 42,90.

Because I was planning to move up to LOS in March and buy a car and some real estate, and this woul cost me rather a few hundred thousands of Baht more, and my income from belgium will loose a lot of value. That's why my wife and I are considering to prospone our plans till eveything get normal again.

concerning KBC, its a raid by traders for unknown reasons, because the bank is very healty, the only reason could be that some raders earn a lot of money by this banking crisis, and we never know who will be their next target. Thats why common people should not get involved in the stockmarket and pull out our sweat it out. Just remember that one man (Soros) could create almost the downfall of the Brittish pound some 20 years ago and created the Downfall of Asian currency's in 1997. I think that their is more going on than just an financial crisis, or am I suffering from paranoia.

[lannarebirth]

Governments should bail out these idiot funds?

http://business.timesonline.co.uk/tol/busi...icle5036543.ece

[cclub75]

Governments should bail out these idiot funds?

http://business.timesonline.co.uk/tol/busi...icle5036543.ece

If it was only funds... But it seems that banks too played the same game.

Societe Generale suffers from a lot of rumors. They have issued this morning a statement : "we do not have OPEN positions on this stock"... But yesterday, maybe they closed their positions.

Societe Generale received a few billions euros from the french gvt 2 weeks ago...

[lannarebirth]

Governments should bail out these idiot funds?

http://business.timesonline.co.uk/tol/busi...icle5036543.ece

If it was only funds... But it seems that banks too played the same game.

Societe Generale suffers from a lot of rumors. They have issued this morning a statement : "we do not have OPEN positions on this stock"... But yesterday, maybe they closed their positions.

Societe Generale received a few billions euros from the french gvt 2 weeks ago...

I think people thought I was joking, when I said that these big banks with trading divisions are daytrading their national treasuries. That's exactly what's going on in many markets. They are hopeful they can sell it off to the public at higher levels. The taxpayer pays twice, at least.

[lannarebirth]

Stratfor

Fourth Quarter Forecast 2008

October 23, 2008 | 1502 GMT

Three issues will dominate the final quarter of 2008: the global financial crisis, U.S. self-absorption and the Russian resurgence.

The financial crisis has its roots in an American liquidity meltdown. But as the days flow by, it will become obvious that the crisis is evolving as it spreads to the rest of the world, and its impact will be harsher and require more time for recovery elsewhere. For in the United States, actions have already been taken to rectify the liquidity imbalances, and although plenty can still go wrong and a recession is probably inevitable, the system is beginning to mend. In Europe, however, the liquidity shortage has unearthed a deep banking debacle.

Remediation is only now being started, and the problem is only now being identified, much less evaluated. The American recession will probably be over by year's end, but Europe's will likely stretch through most of 2009. And in East Asia, where the problem is neither liquidity nor banking but loss of export demand, recovery cannot even begin until the West begins demanding Asian goods en masse. The United States might have set the crisis running, but it will be Europe and Asia that really give it its legs.

http://www.investorsinsight.com/blogs/john...ecast-2008.aspx

[siamamerican]

Stratfor

Fourth Quarter Forecast 2008

October 23, 2008 | 1502 GMT

Three issues will dominate the final quarter of 2008: the global financial crisis, U.S. self-absorption and the Russian resurgence.

The financial crisis has its roots in an American liquidity meltdown. But as the days flow by, it will become obvious that the crisis is evolving as it spreads to the rest of the world, and its impact will be harsher and require more time for recovery elsewhere. For in the United States, actions have already been taken to rectify the liquidity imbalances, and although plenty can still go wrong and a recession is probably inevitable, the system is beginning to mend. In Europe, however, the liquidity shortage has unearthed a deep banking debacle.

Remediation is only now being started, and the problem is only now being identified, much less evaluated. The American recession will probably be over by year's end, but Europe's will likely stretch through most of 2009. And in East Asia, where the problem is neither liquidity nor banking but loss of export demand, recovery cannot even begin until the West begins demanding Asian goods en masse. The United States might have set the crisis running, but it will be Europe and Asia that really give it its legs.

http://www.investorsinsight.com/blogs/john...ecast-2008.aspx

This was the point of my OP. I think the article sugar coated the US financial issues, but was correct in its assessment that Europe is going to have a tougher time dealing with this crisis. While this financial crisis was unfolding Europeans were bashing the US without looking in the mirror.

Most developed nations have been propping up growth with easy money and real estate driven consumer spending. The US is going to fix the banking sector, but will not avoid a bad recession. I'm not as confident that Europe is going to resolve is banking sector issues anytime soon and the ensuing recession is going to be very painful and last longer than the US.

[Pakboong]

Governments should bail out these idiot funds?

http://business.timesonline.co.uk/tol/busi...icle5036543.ece

Government should had least insure the top executives of these funds get their Christmas bonuses.

[Naam]

"The American recession will probably be over by year's end, but Europe's will likely stretch through most of 2009."

and from 2010 onwards everybody will live happily ever after. what a load of optimistic rubbish!

[Pakboong]

"The American recession will probably be over by year's end, but Europe's will likely stretch through most of 2009."

and from 2010 onwards everybody will live happily ever after. what a load of optimistic rubbish!

IMHO the most telling example of just how bad this is going to get is provided in the article below regarding large long haul commercial trucks. Volvo, the worlds second largest supplier, has its orders down this year from over 41.000 last year to 155. Almost not believable.

http://www.silverbearcafe.com/private/10.08/volvo.html

[Naam]

"The American recession will probably be over by year's end, but Europe's will likely stretch through most of 2009."

and from 2010 onwards everybody will live happily ever after. what a load of optimistic rubbish!

IMHO the most telling example of just how bad this is going to get is provided in the article below regarding large long haul commercial trucks. Volvo, the worlds second largest supplier, has its orders down this year from over 41.000 last year to 155. Almost not believable.

my [not so] so humble opinion is that most countries will still feel the negative effects of the present crisis for several years. even now the implications of the crisis on global economy cannot be quantified and only bloody ignorants or blatant liars can have the audacity and talk about "over by year's end" and/or "most of 2009".

the sad thing is that (as usual) those who are financially handicapped will bear the brunt of the crisis

[siamamerican]

the sad thing is that (as usual) those who are financially handicapped will bear the brunt of the crisis

Many are going to feel alot of pain, handicapped or not. People of all income levels forgot about the risks of greed. Ignoring greed is ludicrous, considering that 98% of the population is extremely greedy. Some are just better at harnessing greed and creating wealth.

Everybody needs to take a deep look at themselves before blaming others. E.g., many in the US middle class that purchased homes with no down payments and crazy high debt to incomes, people in Spain that bought homes that went up 100% in value in 8 years, etc...

It's time we stop blaming everyone but the person that signed the note. We aren't apes and perfectly capable of making financial decisions and dealing with the consequences.

[Naam]

the sad thing is that (as usual) those who are financially handicapped will bear the brunt of the crisis

Many are going to feel alot of pain, handicapped or not. People of all income levels forgot about the risks of greed. Ignoring greed is ludicrous, considering that 98% of the population is extremely greedy. Some are just better at harnessing greed and creating wealth.

Everybody needs to take a deep look at themselves before blaming others. E.g., many in the US middle class that purchased homes with no down payments and crazy high debt to incomes, people in Spain that bought homes that went up 100% in value in 8 years, etc...

It's time we stop blaming everyone but the person that signed the note. We aren't apes and perfectly capable of making financial decisions and dealing with the consequences.

c'mon Siam-A. you are of course right blaming those people you mentioned for being stupid. but these people did not issue derivatives amounting to trillions or more. if the greedy bankers worldwide wouldn't have played their private and utmost stupid game nothing but foreclosures amounting to peanuts (compared to now) had happened!

[flying]

Governments should bail out these idiot funds?

http://business.timesonline.co.uk/tol/busi...icle5036543.ece

Nope!

Shouldnt have bailed anyone out. None ...no banks...no funds...no companies Nada...zip ....zilch

The hedge funds were trying to cover potential losses after placing huge bets that Volkswagen shares would fall.

Back in early 2000 when the Nasdaq was in the 5k range I was investing & realized it all had turned to gambling. I tend to think the internet trading had a lot to do with it too. Investors large & small seemed to all become day traders. But really it was no longer investing. Then doing project management for a company that was very large & seeing how they cooked the books made me realize something.

Invest in yourself

[henryalleman]

"The American recession will probably be over by year's end, but Europe's will likely stretch through most of 2009."

and from 2010 onwards everybody will live happily ever after. what a load of optimistic rubbish!

IMHO the most telling example of just how bad this is going to get is provided in the article below regarding large long haul commercial trucks. Volvo, the worlds second largest supplier, has its orders down this year from over 41.000 last year to 155. Almost not believable.

http://www.silverbearcafe.com/private/10.08/volvo.html

Volvo Truck in Gent(Flanders) did stop the night shift, GM Antwerp send people home for 5 weeks; ALZ steel plant who produce INOX close his plant for 5 weeks, another steel plant will close his plant for 13 weeks. Picanol a world leader of producing weaving looms has a lot of orders cancelled from Chinese and other Asian textile manufacturers, Their order book for the second half of 2009 is almost empty, and have therefore also a temporary unemployment.

Lucky we have a system of temporary unemployment in Belgium where the company pay an additional some of money on top of the stamp money during the temporary closing of plants, so nobody loses his job.

On the other hand the building industry is still going strong, mainly because the government subsidize the people who like to renovate their house, and who make investments on energy saving improvements. The building contractors stillhave many jobs available who can not be filled in.Also High tech companies are still growing and are desperate seeking engineers and IT experts.

IMHO we are facing a transition of our banking and industrial system,and this will be not without pain.

[henryalleman]

"The American recession will probably be over by year's end, but Europe's will likely stretch through most of 2009."

and from 2010 onwards everybody will live happily ever after. what a load of optimistic rubbish!

IMHO the most telling example of just how bad this is going to get is provided in the article below regarding large long haul commercial trucks. Volvo, the worlds second largest supplier, has its orders down this year from over 41.000 last year to 155. Almost not believable.

http://www.silverbearcafe.com/private/10.08/volvo.html

Volvo Truck in Gent(Flanders) did stop the night shift, GM Antwerp send people home for 5 weeks; ALZ steel plant who produce INOX close his plant for 5 weeks, another steel plant will close his plant for 13 weeks. Picanol a world leader of producing weaving looms has a lot of orders cancelled from Chinese and other Asian textile manufacturers, Their order book for the second half of 2009 is almost empty, and have therefore also a temporary unemployment.

Lucky we have a system of temporary unemployment in Belgium where the company pay an additional some of money on top of the stamp money during the temporary closing of plants, so nobody loses his job.

On the other hand the building industry is still going strong, mainly because the government subsidize the people who like to renovate their house, and who make investments on energy saving improvements. The building contractors still have many jobs available who can not be filled in.Also High tech companies are still growing and are desperate seeking engineers and IT experts.

IMHO we are facing a transition of our banking and industrial system,and this will be not without pain.

[Pakboong]

"The American recession will probably be over by year's end, but Europe's will likely stretch through most of 2009."

and from 2010 onwards everybody will live happily ever after. what a load of optimistic rubbish!

IMHO the most telling example of just how bad this is going to get is provided in the article below regarding large long haul commercial trucks. Volvo, the worlds second largest supplier, has its orders down this year from over 41.000 last year to 155. Almost not believable.

http://www.silverbearcafe.com/private/10.08/volvo.html

Volvo Truck in Gent(Flanders) did stop the night shift, GM Antwerp send people home for 5 weeks; ALZ steel plant who produce INOX close his plant for 5 weeks, another steel plant will close his plant for 13 weeks. Picanol a world leader of producing weaving looms has a lot of orders cancelled from Chinese and other Asian textile manufacturers, Their order book for the second half of 2009 is almost empty, and have therefore also a temporary unemployment.

Lucky we have a system of temporary unemployment in Belgium where the company pay an additional some of money on top of the stamp money during the temporary closing of plants, so nobody loses his job.

On the other hand the building industry is still going strong, mainly because the government subsidize the people who like to renovate their house, and who make investments on energy saving improvements. The building contractors still have many jobs available who can not be filled in.Also High tech companies are still growing and are desperate seeking engineers and IT experts.

IMHO we are facing a transition of our banking and industrial system,and this will be not without pain.

Unfortunately, we are closer to the beginning than to the end of this mess.

[LaoPo]

Spain has a big problem in the real estate and mortgage industry. The Spanish Government has decided to help (jobless and other) people who are in severe trouble paying their mortgages:

Spain Lets Jobless Postpone Half of Mortgage Payments

Nov. 3 (Bloomberg) -- Spain will allow unemployed workers to put off paying half their monthly mortgage payments for two years, Prime Minister Jose Luis Rodriguez Zapatero said today, part of a series of measures aimed at softening the impact of a shrinking economy.

The postponed payments, up to a maximum of 500 euros ($640) a month, will be repaid from January 2011 in installments, Zapatero told a news conference in Madrid today. The measure, which applies to mortgages under 170,000 euros ($218,000), could be used by more than 500,000 people, he said.

Continues here:

http://www.bloomberg.com/apps/news?pid=new...id=aMmMxLFw8D3Q

LaoPo

[siamamerican]

the sad thing is that (as usual) those who are financially handicapped will bear the brunt of the crisis

Many are going to feel alot of pain, handicapped or not. People of all income levels forgot about the risks of greed. Ignoring greed is ludicrous, considering that 98% of the population is extremely greedy. Some are just better at harnessing greed and creating wealth.

Everybody needs to take a deep look at themselves before blaming others. E.g., many in the US middle class that purchased homes with no down payments and crazy high debt to incomes, people in Spain that bought homes that went up 100% in value in 8 years, etc...

It's time we stop blaming everyone but the person that signed the note. We aren't apes and perfectly capable of making financial decisions and dealing with the consequences.

c'mon Siam-A. you are of course right blaming those people you mentioned for being stupid. but these people did not issue derivatives amounting to trillions or more. if the greedy bankers worldwide wouldn't have played their private and utmost stupid game nothing but foreclosures amounting to peanuts (compared to now) had happened!

I disagree, derivatives are a huge problem but would amount to nothing without foreclosures. EU banks don't have the derivative exposure of US banks and are facing the same issues. I understand derivatives and foreclosures feed off each other, but at this point which evil is worse is hard to grasp.

[siamamerican]

Spain has a big problem in the real estate and mortgage industry. The Spanish Government has decided to help (jobless and other) people who are in severe trouble paying their mortgages:

Spain Lets Jobless Postpone Half of Mortgage Payments

Nov. 3 (Bloomberg) -- Spain will allow unemployed workers to put off paying half their monthly mortgage payments for two years, Prime Minister Jose Luis Rodriguez Zapatero said today, part of a series of measures aimed at softening the impact of a shrinking economy.

The postponed payments, up to a maximum of 500 euros ($640) a month, will be repaid from January 2011 in installments, Zapatero told a news conference in Madrid today. The measure, which applies to mortgages under 170,000 euros ($218,000), could be used by more than 500,000 people, he said.

Continues here:

http://www.bloomberg.com/apps/news?pid=new...id=aMmMxLFw8D3Q

LaoPo

I actually prefer this approach compared to what some banks and government agencies are promoting in the US. Delinquent borrowers that are late on payments have their loan balances decreased. Seems to me that the wrong type of behavior is rewarded and the responsible borrowers are punished. Spain's action only postpones and doesn't eliminate debt. Seems fare to me.

[flying]

Nov. 3 (Bloomberg) -- Spain will allow unemployed workers to put off paying half their monthly mortgage payments for two years,

I actually prefer this approach compared to what some banks and government agencies are promoting in the US. Delinquent borrowers that are late on payments have their loan balances decreased. Seems to me that the wrong type of behavior is rewarded and the responsible borrowers are punished. Spain's action only postpones and doesn't eliminate debt. Seems fare to me.

I prefer it too. But the one thing I dont understand is how these unemployed workers will pay 1/2 the mortgage. Would have been nice if the govt. said payment holiday till we are back on our feet

[Naam]

I disagree, derivatives are a huge problem but would amount to nothing without foreclosures. EU banks don't have the derivative exposure of US banks and are facing the same issues. I understand derivatives and foreclosures feed off each other, but at this point which evil is worse is hard to grasp.

and i disagree completely with your statement. what you seem to forget is that european (and other) banks were stupid enough to buy the derivatives FROM U.S. banks based on U.S. subprime mortgages. besides that there is no doubt they are facing their own problems concerning financing of real estate.

[Naam]

"The American recession will probably be over by year's end, but Europe's will likely stretch through most of 2009."

and from 2010 onwards everybody will live happily ever after. what a load of optimistic rubbish!

NEW YORK (Reuters) - Factory activity contracted sharply in October, falling to its lowest in 26 years as the financial crisis ravaged the world's largest economy and its trading partners around the globe.

"Pretty grim. It means we're in a recession, it's as simple as that ... a pretty solid manufacturing recession," said Robert Macintosh, chief economist at Eaton Vance Corp in Boston. "The question is, 'How long or deep is it going to be?"

don't worry Bob. according to learned anal-lusters the U.S. recession will be over in 57 days!

[BEENTHEREDONETHAT]

Don't forget the upcoming credit card crisis

This past summer's subprime meltdown involved about $900 billion in now-suspect securitized debt, reckless lending, and consumers who buckled under the weight of loans they couldn't afford. Now another link in the consumer debt chain - credit cards - is starting to show signs of strain. And the fear that the $915 billion in U.S. credit card debt (an uncannily similar figure) may blow up has major financial institutions like Citigroup, American Express, and Bank of America strapping on their Kevlar vests.

http://finance.yahoo.com/banking-budgeting...rs'-Wallets

Edited November 4, 2008 by BEENTHEREDONETHAT

[Naam]

Don't forget the upcoming credit card crisis

This past summer's subprime meltdown involved about $900 billion in now-suspect securitized debt, reckless lending, and consumers who buckled under the weight of loans they couldn't afford. Now another link in the consumer debt chain - credit cards - is starting to show signs of strain. And the fear that the $915 billion in U.S. credit card debt (an uncannily similar figure) may blow up has major financial institutions like Citigroup, American Express, and Bank of America strapping on their

all caused by debtors in Spain, Ireland and Germany (not to forget Macedonia and Kossovo!). there is no connection whatsoever to the Greatest Nation on Earth™

[Soutpeel]

Don't forget the upcoming credit card crisis

This past summer's subprime meltdown involved about $900 billion in now-suspect securitized debt, reckless lending, and consumers who buckled under the weight of loans they couldn't afford. Now another link in the consumer debt chain - credit cards - is starting to show signs of strain. And the fear that the $915 billion in U.S. credit card debt (an uncannily similar figure) may blow up has major financial institutions like Citigroup, American Express, and Bank of America strapping on their

all caused by debtors in Spain, Ireland and Germany (not to forget Macedonia and Kossovo!). there is no connection whatsoever to the Greatest Nation on Earth™

[flying]

Man this is the bears den in here