Aerar

A commonplace of german politics

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Plenty helps plenty

22 March, 2010 (20:34) | economy, finance | By: Aerar

(German version published on 28 November, 2009)

When a water hose has a hole it might help to simply pump in more water instead of fixing the problem. This solution at least is prefered by the German government with its spending a billion against loan shortage (German). If only enough money (German) will be pumped into banks in the end something has to reach the companies.

I could not agree with this logic in January and wondered why banks, after they have been saved by the tax payers now should be part of the plan to save companies. Obviously there are much more interesting assets (German), (I am sorry that this article was already written in June but I did not find the article with a quite similiar content I read a few days ago) like the stock market (German) where indexes have tripled since March or in a more conservative way, in lending back the money to the government with better conditions.

You can surely bemoan this like me and other bloggers (German) do from time to time but there is hardly any resonance. So I wonder whether I am completely mistaken with my valuation or is the portentousness too big so that nobody is able to bother?
Maybe it is just a lack of alternatives. At least I don’t have an idea. The government can’t be dismissed in the coming years and even a new government probably won’t act differently. Boycotting banks would be no solution as private customers are even less wanted than the small and medium-sized businesses, so it is unlikely many banks would be impressed. On the other hand every one needs a private bank account. So maybe there is anyone with a good idea here?