from the hip

The American subprime crisis has consequences in a large numner of countries around the world. The German newspaper Der Spiegel recently reported that German banks could lose as much as 70 billion Euros (about 110 billion US dollars):

German Banks Could Hemorrhage 70 Billion Euros

The fallout in Germany from exposure to America’s subprime crisis may turn out to be far bigger than previously feared. One major newspaper is putting estimated losses at a whopping 70 billion euros, while a prominent politician warns that the US recession has already arrived in Germany.

German banking executives fear the current financial crisis (more…) is quickly shaping up to be the worst since 1929. In its Friday edition, mass-circulation daily Bild newspaper cites banking insiders who predict that total losses at German banks from the American subprime mortgage loan crisis could hit the €70-billion ($111 billion) mark.

A number of large German banks, Deutche Bank, UBS, WestLB, Bayern LB are writing down billions of euros. Several of the banks have received government injections of money to keep them floating. The German banking system is shaky and losing customer confidence.