Print version here.
Some highlights:
Ackermann: If you are not omniscient and cannot precisely predict the future, you don't necessarily have to be plagued by self-doubt... I didn't think that individual banks had accumulated risks -- in some cases off the balance sheets -- of such a magnitude as has occurred. (Some?) ..... Ackermann: It is very difficult to recognize bubbles in advance. At what point do rising prices constitute a bubble? If you sell off too quickly, you lose earnings and may soon no longer be in business. If you react too late, you suffer large losses. There would be no banking industry without risks, which is why it is so important, especially during boom periods, to maintain risk discipline -- or risk ethics. This is what we have done at Deutsche Bank. We, therefore, suffered no losses that threatened our capital basis, or even our existence. SPIEGEL: Nevertheless, Deutsche Bank only survived because the entire system was stabilized with taxpayers' money. Ackermann: We are grateful for the rapid and decisive intervention of the countries and central banks in the financial crisis. If it had come to a meltdown, for example, of Hypo Real Estate, this of course would have been devastating for us, too. But we also have to differentiate between those who have independently secured their existence, and those who could no longer do so. And I would like to point out that, in the final analysis, by issuing these bailouts the government acted in the interests of taxpayers and the entire economy. .... SPIEGEL: Many companies complain that the banks are no longer lending them money. Is there a credit crunch? Ackermann: I have not noticed a general credit crunch. There is no doubt that companies' loan costs and loan requirements have increased. But I can assure you that we, Deutsche Bank, remain available, as ever, with loans for our customers. SPIEGEL: Nevertheless, the cheap money of the central banks is not reaching bank customers. Instead many banks have returned to the same old business deals, allowing them to make big profits again. Is the party simply continuing after the crisis? Ackermann: The facts look different. First, interest rates have fallen, both for consumer loans and mortgages. The cheap money from the central banks cannot be passed on to customers as cheaply because it only makes a small contribution to the banks' refinancing volumes. The majority of our refinancing costs are significantly higher. Incidentally, the interest rate reflects not only the refinancing costs, but also the default risk. And this has increased due to the recession. ....
SPIEGEL: Nevertheless, Deutsche Bank only survived because the entire system was stabilized with taxpayers' money.
Ackermann: We are grateful for the rapid and decisive intervention of the countries and central banks in the financial crisis. If it had come to a meltdown, for example, of Hypo Real Estate, this of course would have been devastating for us, too. But we also have to differentiate between those who have independently secured their existence, and those who could no longer do so. And I would like to point out that, in the final analysis, by issuing these bailouts the government acted in the interests of taxpayers and the entire economy. .... SPIEGEL: Many companies complain that the banks are no longer lending them money. Is there a credit crunch?
Ackermann: I have not noticed a general credit crunch. There is no doubt that companies' loan costs and loan requirements have increased. But I can assure you that we, Deutsche Bank, remain available, as ever, with loans for our customers.
SPIEGEL: Nevertheless, the cheap money of the central banks is not reaching bank customers. Instead many banks have returned to the same old business deals, allowing them to make big profits again. Is the party simply continuing after the crisis?
Ackermann: The facts look different. First, interest rates have fallen, both for consumer loans and mortgages. The cheap money from the central banks cannot be passed on to customers as cheaply because it only makes a small contribution to the banks' refinancing volumes. The majority of our refinancing costs are significantly higher. Incidentally, the interest rate reflects not only the refinancing costs, but also the default risk. And this has increased due to the recession. ....
Much a what Ackermann says is seemingly harmless doublespeak, but at least from my perspective, reading between the lines (and there's so much more in the interview) illuminates Jérôme's points perfectly.
<blockquoe> Ackermann: I expect changes in some areas of the tax system. I also hope that we can launch some new initiatives in our health and labor market policies. (wonder what that means?)
I wish i wasn't thinking that this system has to devolve into chaos before it can begin the move to sustainability and right livelihood. But then i read that BRIC and the Middle East are developing a plan to create a new currency basket in which to price oil. Wheeeeeeee! "Life shrinks or expands in proportion to one's courage." - Anaïs Nin
Ackermann: I expect changes in some areas of the tax system. I also hope that we can launch some new initiatives in our health and labor market policies. (wonder what that means?)
