To explain the resentment executives in the rest of the modern world feel on occasion when forced to look at the United States on the map hanging in the conference room of their “European Headquarters Building,” you have to look no farther than the story in yesterday’s New York Times describing the absolute schooling a certain German bank faced at the hands of our favorite newly-defunct Investment Bank.
Of course, it’s hard to feel too bad when the very first webpage on the bank’s site brags that “In 2007 KfW Bankengruppe committed a total financing volume of EUR 87.1 billion – an increase of 13% over the previous year (EUR 76.7 billion).”
Apparently, this year’s tally will include a 300,000,000 Euro payment wired to Lehman Brothers… the same day Lehman’s holding company declared bankruptcy.
Woops.
Don’t Worry, Resignations and Dismissals Will Not Be “The Final Word.’ And, according to themselves:
“In the first half of 2008 KfW successfully defied the very volatile international capital markets with its funding strategy.”
Why is it that American banks never seem to make that mistake?
Calling the accidental transfer scandalous, the German Taxpayers Association demanded an investigation and recommended paring back the unwieldy, 37-member administrative board to encourage better oversight. (Emphasis ours).
Uproar Over German Bank’s Payout to Lehman [New York Times]
If you wear your underwear for 4 days in a row it will smell like hot dirty sex.
Mel Epstein ? Who is he ? What was the track record for Brown University fund over last 20 years , per year ? More to come
@1…but its not the same.
EP…nice picture. Who cares about the Krauts? As they said in Saving Private Ryan…”Let’em burn!”
37 member board eh? Yea, sounds about right for deutchland, just take a look @ the clusterf&ck that is the Porsche/VW engagement, freaking disaster
That 300M euro was paid within 90 days of the bk filing so it could be prefential payment and will be up for dispute.
@5…idiot preferential payment is if LEH made the payment not received it. Get off the computer and go watch sponge bob…you dimwit.
Other Things the Fed/SEC/Treasury (FST) Are Going to Prohibit
1. Saying nasty things about FST in any news media. FST will be the final arbiter of what is nasty. Full rules and regulations will be published at some point in the future, god help you if you violate them now.
2. Selling a stock short that FST even THINKS might go down in price at any time over the next year.
3. Women who are employed at any of the financial firms on the DO NOT SHORT LIST from wearing flip-flops to work.
4. Jim Cramer from hitting his “SELL, SELL, SELL” button for any reason during his TV show.
5. Money Market Funds from buying any asset they can’t explain to Nancy Pelosi using only two PowerPoint slides and no more than three boxes and arrows.
6. Any structured product that has the words “collateralized” or “synthetic” in its name.
7. Steve Liesman from speaking on air. Period. He only confuses the situation even more.
8. Men who are employed at any of the financial firms on the DO NOT SHORT LIST from wearing a dress shirt that requires cuff links without also wearing a tie.
9. Any person who is running for President or Vice President of the US in the November 2008 elections from explaining how they would handle the current financial crisis if they were elected unless they are appearing on the Comedy Channel, guest hosting for Saturday Night Live or standing in for Jay Leno’s monologue.
@3
As Donald Rumsfeld said, “you work with the army you have not the army you want to have.”
Was Ihr wollt… Geld!
http://www.youtube.com/watch?v=CZMs724hbuc
@8…only losers who don’t get laid say that.
“Your best?” “Winners go home fuck the prom queen.”
I’m sure the German public found the adjacent story on the cover of Bild (pictured in the NYT) more interesting than Lehman – socialist politician reveals plenty of decolletage at Oktoberfest party.
@10
You never fucked the prom queen.
@12 Stimmt!
@13
I’m sorry.
@13
I’m sorry.
@4: Oh, well the “lean” boards of U.S. finance cos seemed to have done their homework so well, that we need Moscow’s old strategies to unwind the trash of their ever diligent oversight!
@13
I’m sorry.
It was their turn to take a ride on the Venga Bus, and things got a little out of control.
Stimmt?
http://www.youtube.com/watch?v=18_jz1SpJyg
ouch!
@13 Like I said, you never fucked the prom queen.
Thanks for showing up drive home safely.
Did someone just mention the venga bus?
Paulson has a slight resemblance to Colonel Klink. That’s all.
@diablo
Paulson looks like that dude in the original Charlie & The Chocolate Factory movie
Crisis talks over $700B ‘toxic debt’ rescue plan
The Credit Default Swap was invented a few years ago by a young Cambridge University mathematics graduate, Blythe Masters, hired by J.P. Morgan Chase Bank in New York. The then-fresh university graduate convinced her bosses at Morgan Chase to develop a revolutionary new risk product, the CDS as it soon became known.
Warren Buffett once described derivatives bought speculatively as “financial weapons of mass destruction.” In his Berkshire Hathaway annual report to shareholders he said “Unless derivatives contracts are collateralized or guaranteed, their ultimate value depends on the creditworthiness of the counterparties.
The crisis is partly an epistemological one. Few people outside of the financial industry have ever understood how the new complex derivatives work. Were they hedges or means of multiplying leverage? It turns out that few people inside the industry understood either. The most astonishing stories of the past week have to do with AIG’s final weekend, when teams of government analysts and accountants from the world’s leading investment banks could not figure out how much cash the company would require in order to collateralise its credit-default swaps. Estimates rose from $20bn to $85bn…Crisis talks over $700B ‘toxic debt’ rescue plan…
What should be the fate of that cu..