German government might seize bank shareholders' shares

[notime]

http://www.france24.com/en/20090218-...nancial-crisis

The German government is set to adopt a law allowing it to temporarily nationalise troubled banks through the seizure of shares, according to a draft text obtained by AFP Wednesday.

But as the crisis shows no sign of ending, the nationalisation of major banks -- previously unthinkable -- is becoming increasingly seen as a palatable option in the face of the ongoing financial sector chaos.

Banks have already been nationalised in Britain and Ireland.

And the former chairman of the US Federal Reserve, Alan Greenspan, said Tuesday in interview with the Financial Times that the US government may have to temporarily nationalise the country's banks until the sector is reformed.
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Glad I don't have any stocks in banks since Governments now start to plan to "just take anybodies shares".

[IllTestYourGirls]

Nothing is temporary in government. Once they seize these banks and nationalize them the game is over the banks will be nationalized forever.

[Phoenix]

history repeats itself

[notime]

So if somebody owns let's say 10 million in stocks in this bank, it's now no longer his.
The government seizes these shares. And he won't get paid and just would lose his 10 million ?
WTF
That's like a reversed Robin Hood act.

[Agent 488]

shit happens.

[Quagmire]

Originally Posted by notime

So if somebody owns let's say 10 million in stocks in this bank, it's now no longer his.
The government seizes these shares. And he won't get paid and just would lose his 10 million ?
WTF
That's like a reversed Robin Hood act.

They will purchase the stocks at an obscenely low rate as punishment to the big stock holders. And anyone else who was along for the ride...

[Pleasurepays]

Yay! Stalin would have wanted it that way!

[notime]

Originally Posted by Quagmire

They will purchase the stocks at an obscenely low rate as punishment to the big stock holders. And anyone else who was along for the ride...

So the crooked bankers get saved since the governments wanna save the consumers whereas the shareholders take the financial fall for it.
I wonder if this resolves the problem. Probably not, just the temporary pressure.

Any Germans in here that more info to share?

[MaDalton]

Originally Posted by notime

So the crooked bankers get saved since the governments wanna save the consumers whereas the shareholders take the financial fall for it.
I wonder if this resolves the problem. Probably not, just the temporary pressure.

Any Germans in here that more info to share?

actually there are a couple of things not quite correct:

first of all it's not "banks", this law is only temporarily and only for "Hypo Real Estate (HRE)". it will automatically expire on June 30, 2009

second: it will only happen if HRE is going bankrupt - or better: to prevent HRE from going bankrupt. cause in that case a couple of other banks and insurance companies might go under as well. which could crash German (and European) economy totally.

i'm not a supporter of this usually but in this case it seems to be necessary to have this as a last resort

[tranza]

Originally Posted by budsbabes

shit happens.

Unhappily!

[notime]

Originally Posted by MaDalton

actually there are a couple of things not quite correct:

first of all it's not "banks", this law is only temporarily and only for "Hypo Real Estate (HRE)". it will automatically expire on June 30, 2009

second: it will only happen if HRE is going bankrupt - or better: to prevent HRE from going bankrupt. cause in that case a couple of other banks and insurance companies might go under as well. which could crash German (and European) economy totally.

i'm not a supporter of this usually but in this case it seems to be necessary to have this as a last resort

Thanks for the local insight Stefan. Much appriciated. Makes more sense now.