German Debts Set to Blow 'Like a Grenade'

[peaceandlove]

German Debts Set to Blow 'Like a Grenade'

Germany's financial regulator BaFin has warned that the toxic debts of the country's banks will blow up "like a grenade" unless they take advantage of the government's bad bank plans to prepare for the next phase of the crisis.

By Ambrose Evans-Pritchard
Last Updated: 9:54PM BST 25 May 2009

Excerpt:

The German bad bank plan has been heavily criticised as an attempt to brush the problems under the carpet until after the elections in September. It allows banks to spread losses over 20 years in an off-balance sheet vehicle – much like the "SIVs" that masked their extreme leverage in the first place – and risks repeating the Japanese error of letting "zombie" banks limp on rather than purging the system.
The recession has hit Europe much harder than expected.

Complete article: http://www.telegraph.co.uk/finance/f...a-grenade.html

Source: http://solari.com/blog/ Catherine Austin Fitts Blog