Germany's Banks Must Assist in Europe's Cleanup
Note to Angela Merkel: Your banks have been bailed out, too.
from Bloomberg BusinessWeek

Would it surprise you to know that Europe’s taxpayers have provided as much financial support to Germany as they have to Greece? What the widely accepted European morality tale ignores is that irresponsible borrowers can’t exist without irresponsible lenders. Germany’s banks were Greece’s enablers. Thanks in part to lax regulation, German banks built up precarious exposures to Europe’s periphery countries in the years before the crisis. By December 2009, according to the Bank for International Settlements, German banks had amassed claims of $704 billion on Greece, Ireland, Italy, Portugal, and Spain, far more than German banks’ aggregate capital. In other words, they lent more than they could afford.

Read More: German Banks' Exposure

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