To my point that
>
>> It seems to me that what the EIB lends is pretty much chicken feed.
>
C. Redmond wrote:
>Total assets of 200 billion EUR, a balance-sheet increasing 30% a year,
>and lots of funding for schools, hospitals, business incubators and
>infrastructure is indeed significant. Remember, we're talking 30 billion
>EUR in direct investment in things which produce value, not payouts to
>rentier greedheads or property bubbles; the folks at Eurostat
>(http://europa.eu.int/comm/eurostat/Public/datashop) say total EU
>Government investment expenditure in 1999 was 183 billion EUR or so,
>meaning EIB funds were an eighth of this. Essentially, the
>Eurostate is doing an end run around the Maastricht limits on national
>debt with euro-debt.
>
>Also, the EIB is the largest single investor in Eastern Europe. I'm not
>sure what the Central European equivalent of the dragon would be;
>wolverines, maybe?
>
>-- Dennis
Right, I saw the web site, but go to http://www.chase.com, and see the numbers there. The EU should be even a slightly bigger economy than the US and the EIB is smaller than one American bank. I'm not saying it's insignificant, particularly for Eastern Europe, but it should be for the EU. That's not enough money to make a big difference, especially when compared to the huge corporate banks in Europe. The most telling difference between chase and the EIB is the better than $350 billion in loan syndications and god-knows-what-all in debt securitization. That's where I think European banks are showing how antiquated they are. U.S. banks are getting debt off their books and onto the open market, freeing their reserves for more lending. Of course Europe has only just developed a currency that they hope will broaden the debt market across national boundaries. Still, the story of the last twenty years has not been bank lending but increased debt securitization - from high-yield corporate to credit card debt.
Look at the Japanese banks teetering under the weight of all those bad mortgages. U.S. banks have mortgage debt securitized and out the door shortly after the mortgages are signed. You seem to see European and Japanese banks as institutions with their own political will - almost as structures that dominate class. I see those banks as institutional buffers between European and Japanese capitalists and economic reality. If the U.S. system gives capitalists more direct power, it also lays the responsibility for their decisions at the door to their portfolios. U.S. banks can only write more mortgages if U.S. capitalists are willing to buy those mortgages from them. U.S. banks can issue so many credit cards in part because some of that debt is somebody else's default if it goes bad. The challenge of capitalism is getting accumulation out of the hands of capitalists and back into the economy. I don't think bourgeois governments and banks are the most efficient way to do that.
peace