| Not WoT related, but the financial situation, if it gets out of hand, is going to put a hurt on all of us, and that will make the required focus on the WoT even harder to achieve. I'm no Chicken Little like the Dhimmicrats, but a Western world in a recession isn't going to pay attention to Iraq, Afghanistan, Pakistan, Malaysia, etc. |
| And unfortunately a whole lot of liquidity is available from the oil ticks for the small consideration of...your soul. |
In Germany, it emerged that the state-bank SachsenLB may have accumulated $80bn of exposure to risky assets through a set of Irish funds kept off balance sheet. The regional government of Saxony agreed yesterday to sell the East German bank - the biggest victim so far of the worldwide credit rout - for a token €300m (£204m) to the Landesbank Baden-Württemberg in Stuttgart (LBBW), ending a three-week saga that has revealed the extent of German involvement in the some of the most treacherous areas of US sub-prime debt.
Georg Milbrandt, prime minister of Saxony, said the sale of state-owned lender was the only viable option. "Given the market turbulence and the pressures on the bank, it could not have gone on without a partner. We want to get our ship off the high waves and into a safe port," he said.
| Once again the gummint has to bail out a bunch of investors who played the market hinky and wrong. It's for our own good, of course ... |
Sachsen LB, founded in 1992 after the fall of the Berlin Wall, was rescued two weeks ago in a state orchestrated bail-out. A consortium of banks agreed to provide a €17.3bn credit lifeline, but only on the understanding that it agreed to be sold to a stronger player. It allegedly used no fewer than five Irish 'conduits' (off-balance sheet vehicles) to invest in collateralised debt obligations (CDOs) and other high-risk instruments, according to German newspaper Süddeutsche Zeitung.
The biggest losses stemmed from structured investment vehicles (SIVs) which involve using short-term credit to buy longer-term assets, creating a mismatch in maturities. |