Democratic Underground Latest Greatest Lobby Journals Search Options Help Login
Google

European Central Bank Sees Crisis Of "Enormous Proportions" As Spain Creates Mortgage Rescue Fund

Printer-friendly format Printer-friendly format
Printer-friendly format Email this thread to a friend
Printer-friendly format Bookmark this thread
This topic is archived.
Home » Discuss » Latest Breaking News Donate to DU
 
Purveyor Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 05:38 PM
Original message
European Central Bank Sees Crisis Of "Enormous Proportions" As Spain Creates Mortgage Rescue Fund
Source: Telegraph UK

The European Central Bank has dramatically changed its tune over the last twenty-four hours as the credit freeze worsens, acknowledging for the first time that the world faces the gravest crisis since the Great Depression.

By Ambrose Evans-Pritchard
Last Updated: 8:34PM BST 07 Oct 2008

A string of governors from across the eurozone have today issued grim warnings in what seemed a coordinated move to prepare the markets for interest rate cuts, perhaps within days.

Guy Quaden, Belgiums ECB member, said the violent storm ravaging Europes banking system was far from over. This is the worst financial crisis since the Thirties, he told the Belgian parliament.

Miguel Angel Ordonez, Spains ECB governor, echoed the warnings in testimony to the Spanish Cortes, acknowledging that the world now faces a crisis of enormous proportions.

In a clear rejection of the ECBs controversial 'go-it-alone policy on monetary policy, he called for joint action with the US Federal Reserve to nurse the credit markets back to life.

Weve got to get together on both sides of the Atlantic. It is absolutely essential to co-ordinate everything, including monetary policy, he said.

Read more: http://www.telegraph.co.uk/finance/comment/ambroseevans...
Printer Friendly | Permalink |  | Top
valerief Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 05:40 PM
Response to Original message
1. Dubya's legacy. nt
Printer Friendly | Permalink |  | Top
 
RainDog Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 05:56 PM
Response to Reply #1
10. A Worldwide Depression
heck u'va job, Bush League!
Printer Friendly | Permalink |  | Top
 
mike_c Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 06:18 PM
Response to Reply #1
13. yep-- the most amazing Midas shit-touch ever....
Truly awful.
Printer Friendly | Permalink |  | Top
 
RUMMYisFROSTED Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Oct-08-08 08:16 AM
Response to Reply #1
25. Meanwhile, a sigh of relief is heard emanating from Hoover's tomb.
Printer Friendly | Permalink |  | Top
 
WriteDown Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 05:41 PM
Response to Original message
2. Wonder how big an interest rate cut we are
talking about.
Printer Friendly | Permalink |  | Top
 
aquart Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 05:44 PM
Response to Reply #2
4. What difference will it make as long as derivatives are legal?
If new mortgages get the same treatment as old ones, would you trust them? And no matter how great the rate cut, are you ready to believe that someone with a job today will still have it tomorrow?

The issue ain't money or rates, it's trust. We do not trust our institutions. Yet they make NO MOVE to improve trust.
Printer Friendly | Permalink |  | Top
 
WriteDown Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 05:49 PM
Response to Reply #4
8. You want to make derivitives illegal?
May as well ban stock markets too.
Printer Friendly | Permalink |  | Top
 
AngryAmish Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Oct-08-08 09:08 AM
Response to Reply #8
28. You see, we SHOULD have ginormous booms and busts in agricultural prices
Those darn corn futures started this mess...
Printer Friendly | Permalink |  | Top
 
WriteDown Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Oct-08-08 09:11 AM
Response to Reply #28
29. So futures and derivatives are now the same thing?
:shrug:
Printer Friendly | Permalink |  | Top
 
AngryAmish Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Oct-08-08 09:34 AM
Response to Reply #29
31. Technically speaking, yes
Edited on Wed Oct-08-08 09:43 AM by AngryAmish
And they have always been.
Printer Friendly | Permalink |  | Top
 
WriteDown Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Oct-08-08 01:29 PM
Response to Reply #31
32. All futures are derivitives but all derivitives are not futures....
you'd be hard pressed to call a swap a future. Derivitives are fine as long as the assets they are based on are sound.
Printer Friendly | Permalink |  | Top
 
AngryAmish Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Oct-08-08 01:41 PM
Response to Reply #32
33. Oh, I agree with you
I think we are talking past each other.

Person X above wanted to ban derivatives. Then my snarky post suggested that agricultural futures (a form of derivative but certainly not the only kind) were bad.

So...futures are indeed a derivative but there are many other derivative vehicles out there. I just get upset when people who have no idea what they are talking about spout about banning this or that when they have no idea what they are talking about. I also cringe when the loudmouth at the end of the bar spouts off about something they do not and cannot understand. Du has many ends of bars and no shortage of loudmouths to fill their spots there. Cheers!
Printer Friendly | Permalink |  | Top
 
WriteDown Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Oct-08-08 01:54 PM
Response to Reply #33
34. Ah....
I like that term, "talking past each other." Cheers to you too.
Printer Friendly | Permalink |  | Top
 
RedEarth Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 07:40 PM
Response to Reply #2
18. I've read a 1% cut is most likely
they hope to coordinate with the rest of the industrialized countries
Printer Friendly | Permalink |  | Top
 
WriteDown Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 07:42 PM
Response to Reply #18
19. That will be HUGE
It will be interesting to see if long term rates follow short term rates and mortgage rates fall for those that are truly qualified.
Printer Friendly | Permalink |  | Top
 
olddad56 Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 11:44 PM
Response to Reply #2
23. Fuck cutting interest rates, they should have been raising them three years ago.
lowering rates won't help, neither will the bailout. Bush'e cronies have already raped the world.
Printer Friendly | Permalink |  | Top
 
WriteDown Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Oct-08-08 08:10 AM
Response to Reply #23
24. Raising them?
Why would you say that? What would that accomplish?
Printer Friendly | Permalink |  | Top
 
percussivemadness Donating Member (733 posts) Send PM | Profile | Ignore Tue Oct-07-08 05:44 PM
Response to Original message
3. End of the EU and the Euro
Game set and match the Dollar...
Printer Friendly | Permalink |  | Top
 
aquart Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 05:45 PM
Response to Reply #3
5. More like end of the dollar.
Printer Friendly | Permalink |  | Top
 
AllieB Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 05:47 PM
Response to Reply #5
7. That's what I think too.
Printer Friendly | Permalink |  | Top
 
WriteDown Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 05:50 PM
Response to Reply #5
9. Can't be both?
:shrug:
Printer Friendly | Permalink |  | Top
 
AllieB Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 05:46 PM
Response to Reply #3
6. How do you figure?
Printer Friendly | Permalink |  | Top
 
fascisthunter Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 06:02 PM
Response to Reply #3
11. Nope... but you will see motivation for more diversity
Printer Friendly | Permalink |  | Top
 
RainDog Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 06:09 PM
Response to Reply #3
12. structurally, EU is a better position
they have massive public transportation programs that are part of every day life. they have a stronger social safety net. they have stronger unions. they have universal health care.

these aren't issue they have to argue with one another when looking at a financial crisis. they have to work with those existing expectations from their citizenry. Here, we still have to argue whether or not someone should have to lose everything they own if they have a health crisis. I know about the difference at very close hand b/c my ex father-in-law become very ill. In the U.S., his family would have ended up in Cabrini Green. Instead, his children have prospered and helped others to get better jobs via education. One of my former sister-in-laws, in contrast, was the daughter of an executive at one of the biggest companies in Europe. Her family thought it was barbaric that the U.S. rich were so greedy that they couldn't pay enough tax to allow a basic standard of life - i.e. living wage, health care... they had more than one home. They bought homes for their children. They weren't poor in any aspect, but they had a sense of country that wasn't about waving a flag, but about viewing your society as your community.
Printer Friendly | Permalink |  | Top
 
pattmarty Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 06:39 PM
Response to Reply #12
14. Hallelujah!!!! Love to see it here, but at age 62 now...............
...........I doubt it unless I live to be oh maybe, 150.
Printer Friendly | Permalink |  | Top
 
RainDog Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 06:56 PM
Response to Reply #14
15. this is why some people would like to move there
and why idiots who live in trailer parks scream that if we don't like the way the U.S. is, we should just move to Europe with those other socialists. The irony is astounding, but the sentiment is widespread among certain.. folk.
Printer Friendly | Permalink |  | Top
 
WriteDown Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 07:13 PM
Response to Reply #15
16. And what keeps people from moving there?
Stringent immigration laws AND enforcement. Same as the U.S. should have. Can't have one without the other.
Printer Friendly | Permalink |  | Top
 
RainDog Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 09:14 PM
Response to Reply #16
21. what keeps me from moving there
is that I got married one year too late. The year before I got married, Belgium stopped automatic citizenship for spouses. My kids can live there and their dad is still a resident alien. but I'm no longer married. I have asked some of my ex's friends to marry me if things get really creepy here - don't really want to get to that, of course.

Immigration enforcement isn't the only issue, however. Lots of EU countries had big immigrant populations because they brought in "guest workers" from Turkey or Morocco, etc. - and their histories of empire mean they have immigrants from those areas they had previously occupied. This creates tensions, but, again, the biggest reason, imo, that quality of life is better for all people in those nations is because of strong unions.

Printer Friendly | Permalink |  | Top
 
Ghost Dog Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 07:52 PM
Response to Reply #3
20. Such would appear to have always been Ambrose Evans-Pritchard's
most fervent desire. :smoke:

The Telegraph, although usually quite serious, is a right-wing, and English-nationalist organ, you know.
Printer Friendly | Permalink |  | Top
 
yardwork Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Oct-08-08 09:02 AM
Response to Reply #3
27. I don't think so. If the dollar goes down, it's going deeper than the euro.
If this was some kind of cockamamie plan to take down the EU and the euro, it will fail. And the U.S. dollar will be the biggest loser.
Printer Friendly | Permalink |  | Top
 
Ghost Dog Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 07:39 PM
Response to Original message
17. More on the latest Spanish moves:
Spain to boost deposit guarantee, create fund
Tue Oct 7, 2008 3:34pm EDT MADRID, Oct 7 (Reuters) - Spain will raise its guarantee for deposits in its banks to 100,000 euros and set up a 30 billion euro fund to buy assets from banks and keep credit flowing to the economy, Prime Minister Jose Luis Rodriguez Zapatero said on Tuesday.

"If there is anywhere Spaniards can know their savings are safe, it's in Spanish banks," Zapatero told a news conference, announcing a guarantee double a minimum agreed at a European finance ministers' meeting in Luxembourg hours earlier.

Spain's banks, which officials say were more conservatively regulated than elsewhere in Europe, have so far been spared the havoc wreaked on banks in the United States or Britain. But the Bank of Spain said on Tuesday that banks could be forced into mergers, and analysts say smaller institutions and savings banks are most exposed to the liquidity drought in financial markets.

Spain's institutions are also exposed to a more traditional type of banking hazard, with homeowners struggling to pay back mortgages as a housing bubble deflates and the economy slows.

...

"The government isn't going to buy toxic assets, but healthy assets," he said, adding that Spain's relatively low public debt level made the measure possible.

"The fund will buy assets from financial institutions, in a voluntary manner on their part, using market criteria, Spanish assets of maximum quality, in order to guarantee over a sufficient period of time that financing makes its way to companies and citizens," Zapatero said.

/... http://www.reuters.com/article/marketsNews/idINL7363787...
Printer Friendly | Permalink |  | Top
 
Zhade Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Oct-07-08 09:16 PM
Response to Original message
22. Remember - this is the Torygraph.
I'd like the news from a REPUTABLE source, thanks.

Printer Friendly | Permalink |  | Top
 
AngryAmish Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Oct-08-08 08:41 AM
Response to Original message
26. Ya think? Spain had the most overpriced real estate in the world
Printer Friendly | Permalink |  | Top
 
WriteDown Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Oct-08-08 09:14 AM
Response to Reply #26
30. You ain't kidding. n/t
Printer Friendly | Permalink |  | Top
 
DU AdBot (1000+ posts) Click to send private message to this author Click to view 
this author's profile Click to add 
this author to your buddy list Click to add 
this author to your Ignore list Thu Jul 24th 2014, 11:34 AM
Response to Original message
Advertisements [?]
 Top

Home » Discuss » Latest Breaking News Donate to DU

Powered by DCForum+ Version 1.1 Copyright 1997-2002 DCScripts.com
Software has been extensively modified by the DU administrators


Important Notices: By participating on this discussion board, visitors agree to abide by the rules outlined on our Rules page. Messages posted on the Democratic Underground Discussion Forums are the opinions of the individuals who post them, and do not necessarily represent the opinions of Democratic Underground, LLC.

Home  |  Discussion Forums  |  Journals |  Store  |  Donate

About DU  |  Contact Us  |  Privacy Policy

Got a message for Democratic Underground? Click here to send us a message.

© 2001 - 2011 Democratic Underground, LLC