THE Global Justice Movement Website

THE Global Justice Movement Website
This is the "Global Justice Movement" (dot org) we refer to in the title of this blog.

Tuesday, October 7, 2008

Europe's Banks Worse Off than those in U.S.

According to a story last week in The Telegraph ("Europe's banks more leveraged than U.S.
Banks," Ambrose Evans-Pritchard, 10/02/08), German Finance Minister Peer Steinbruck in the space of one week flipped from asserting that the meltdown was solely an American problem, to orchestrating the Bundesrepublik's biggest bank bailout. Belgium followed suit by bailing out the 300-year old Fortis, assisted by the Dutch, and then Dexia, with French aid. Ireland then moved into first place in the financial crisis sweepstakes and issued a blanket guarantee for the six largest banks in the Republic. France soon displaced Ireland, while Italy and Spain are growing increasingly nervous.

Naturally, everyone is joining in the "Blame Game" instead of seeking a genuinely viable solution. What is most astounding is that Germany, which benefited from the "miracle" wrought by Dr. Hjalmar Schacht in the 1920s to stop the hyperinflation, should be so blind to the obvious way out: stop extending credit for consumption and government debt, and back the currency with hard assets.

Because the meltdown started with residential real estate, the solution should also start there. It would take very little for the affected countries to study and implement our Homeowners' Equity Corporation proposal, thereby putting a stop to the situation that triggered the current crisis. Rather than repeat what has been stated in so many postings on this blog already, any interested reader can link to the concept paper here, and send this posting via e-mail to those in their countries' governments who are desperately seeking a realistic solution to the crisis.

You really don't have anything to lose.

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