Failure to save East Europe will lead to worldwide meltdown

[Doctor Cynic]

Source: Telegraph

If mishandled by the world policy establishment, this debacle is big enough to shatter the fragile banking systems of Western Europe and set off round two of our financial Götterdämmerung.

Austria's finance minister Josef Pröll made frantic efforts last week to put together a €150bn rescue for the ex-Soviet bloc. Well he might. His banks have lent €230bn to the region, equal to 70pc of Austria's GDP.

"A failure rate of 10pc would lead to the collapse of the Austrian financial sector," reported Der Standard in Vienna. Unfortunately, that is about to happen.

The European Bank for Reconstruction and Development (EBRD) says bad debts will top 10pc and may reach 20pc. The Vienna press said Bank Austria and its Italian owner Unicredit face a "monetary Stalingrad" in the East.

Read more: http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/4623525/Failure-to-save-East-Europe-will-lead-to-worldwide-meltdown.html

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Remember folks: the Great Depression only became global when the Austrian banks collapsed.

It may happen again.

[RoyGBiv]

1. Okay ...

The Austrian banks were rather more important in the early 20th century than they are now. Whether they live or die is not the measure of how bad this will be.

That said, it's bad already and getting worse.

[Historic NY]

2. Thats fine but they shouldn't look to the US, were up to our necks too.

[izquierdista]

3. For whom?

230 lent + 150 last week = 380 billion Euro total?

That's over a thousand Euro per capita in a region where the average worker makes that much in 6 months! It certainly isn't going to the people of that region, or the rise in their standard of living would be obvious. But giving it to bankers, oligarchs, and criminals, which is where 99% of it went, would still leave the average worker out in the garden, digging potatoes. Let the EBRD get repaid from those who took it: Berezovsky, Putin, the bigwigs at Gazprom.

[Mind_your_head]

4. I don't know what "Götterdämmerung" translates to, but that sounds really BAD!

Götterdämmerung! How do we handle/what do we do with the banks/bankers who have been laundering money so 'successfully' for all of these years and now that "the gigs up" and they're running around like chickens with their heads cut off! *sqwak*I want my bonus*squwak*tax cut*squwak*no limits*sqwak*unfair*squwak*

The guillotine would finish them off, rightfully so? :shrug:

[notesdev]

7. It's German

means "Armageddon".

[aquart]

5. I just want to curl up in a ball and grow fur.

I have reached my not coping point.

[notesdev]

6. Yeah yeah

Just the latest round of give-us-money-or-the-world-is-doomed blackmail. They are going to keep doing it until it stops working, and believe you me it has nothing to do with saving anybody but the people reaching into your pocket.

[Granny M]

8. This would be the "New Europe"

the neocons were yapping about. Hope "Old Europe" will be able to help.... Eeegads.

[Mr. Hyde]

9. Am I a bad person for not giving a shit?

[GliderGuider]

10. Well, you're a parochial one, that's for sure.

The Benighted States of America isn't the only soon-to-be-ex engine of economic activity is the world, and globalism means that any injury to your trading partners causes you to bleed as well. Should you give a shit about that?

[Mr. Hyde]

13. hmmm. nope. I stll don't give a shit.

no offense to you personally.

[GliderGuider]

15. No offense taken.

Enjoy your stay at DU. :shrug:

[ixion]

16. nope... just an ignorant one

if you can't see the inter-connectedness of the this, and the direct effect it will have on our situation in the US, then you need to open your eyes and take a look around. Failure to grasp what's coming will only leave you sad and dismayed when it finally reaches your doorstep. And it will.

[Mr. Hyde]

18. We put a buy American provision in our stimulus bill and Europe threatened a trade war over it.

Now it's gone. Fuck. Them.

[ixion]

19. I was for the buy American stipulation

and was extremely disappointed to see it removed. I also think that the idea should be proposed again in the very near future. However, by the same token, I do feel that we should try and avoid a cataclysmic meltdown, if possible.


Although judging by the actions I'm seeing by the governments of both the EU and the US, this is simply not going to be the case.

So, because the pols and the top 1% refuse to release their hand from the honey pot, and because we refuse to work together openly and honestly to solve this problem, we we're all fucked.

When an argument breaks down to:

"Fuck you."

"No, fuck you."

The argument is over, and the violence has started.

[Historic NY]

22. Nope, welcome to DU....we have our own problem & I don't see any help for us (US).

[DFW]

11. "Eastern Europe" is a pretty global term

It covers quite a few diverse places.

The Czech Republic and Slovenia are small countries who border on the west and have
largely truly joined Europe, or are fast on the way. Romania and Bulgaria are mired in
practically Byzantine constant political intrigue, with organized crime and poverty
for the masses being the order of the day. Places like Croatia and Slovakia are
somewhere in between. I have been dealing with many of these countries since 1989,
and with the exception of the Czech Republic (I haven't been back to Slovenia since
Yugoslavia broke up), I would just as soon rescind their membership in NATO and the EU
until they join the 21st century. It isn't all their fault--decades or even centuries of
occupation by foreign powers, forming societies where the only way to get ahead was by
lying to and/or outfoxing the powers that be (unless you were one of them) will do that to
a national psyche.

Nonetheless, here in the west, just the solved violent crimes (a fraction of those committed
in Western Europe) perpetrated by Romanians and Bulgarians since they were allowed to travel to
the west visa-free has tripled. They just come here and play by their rules, and the west can't
cope. Violent crimes committed in Western Europe by Czechs or Slovenes are practically unheard-of.
Grouping all eastern European countries under one label is an erroneous concept at best if you are
talking about anything other than reading a map.

[tonycinla]

21. YES

Totally agree,I have been in business for years and dealing with Bulgarians is very difficult.I hate to single a group out but as a group they are a piece of work,most other East Europeans are difficult also.The system they were raised in did not prepare them to be good Americans.

[silverojo]

12. Yeah, globalization is just great

When one economy struggles, the whole world comes crashing down.

[jody]

14. And failure to save California will lead to worldwide meltdown. n/t

[GliderGuider]

17. Imagine all the places we'd have to "save" to avoid a world-wide meltdown.

Ain't globalization grand? Are we having fun yet?

[JVS]

20. Serves them right for undermining the USSR

[Historic NY]

23. & who said communism was bad....

:silly: