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Eu Recovery May Lag Behind Uk And Us, Says Oecd

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http://www.telegraph.co.uk/finance/economi...-says-OECD.html

Europe faces years of stunted economic growth unless it takes drastic action to drain bad debts out of its banking system, according to the Western world's leading economic institution.

The eurozone nations have not yet done enough to clean up and recapitalise their banking systems, the Organisation for Economic Co-operation and Development (OECD) warned.

In its annual survey of the European Union, the OECD said that unlike the US and UK, many EU nations have failed so far to pump the necessary amount of extra cash into their banks. Until they do so, their economies and financial systems will continue to suffer, perhaps longer than the Anglo-Saxon countries where the crisis originated, the report said.

The warning underlines fears that Europe's path out of the crisis may be longer and more painful than many in the EU nations, since it has been slow to remedy its banks' issues.

The report said: "In many EU countries, uncertainties remain regarding the extent of the impaired assets problems on banks' balance sheets and concerns persist that banks may be insufficiently capitalised to deal with a further deterioration in economic conditions. This will need to be addressed."

Earlier this year, the International Monetary Fund said that European banks faced potential write-downs of up to $1.1 trillion (£680bn), and that their governments may have to pump an extra $725bn into their balance sheets. Such a cash injection would almost certainly imply further nationalisations.

Everywhere you look the entire system looks doomed to collapse.

I think the EU could soon have a major crisis on it's hands.

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Clean up and capitalise? :lol:

WAFJ, that huge great bulge swept under the carpet has to be paid for yet. The politicians in the UK has only just been pushed into even admitting so, let alone instituting the cuts and taxes that will be necessary to actually clear up this mess.

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Dunno. See the above post from Evans-Pritchard in the Telegraph. Re : a weak currency can produce a swift export led recovery.

Well that's what I'm hoping for.

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Thankfully we have the Great British Pound!!

Not where you are ?? :blink:

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Not where you are ?? :blink:

I have a few, not that they are worth much, where's me f_cking rolling pin!!

Edited by Patfig

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The eurozone nations have not yet done enough to clean up and recapitalise their banking systems, the Organisation for Economic Co-operation and Development (OECD) warned.

In its annual survey of the European Union, the OECD said that unlike the US and UK, many EU nations have failed so far to pump the necessary amount of extra cash into their banks. Until they do so, their economies and financial systems will continue to suffer, perhaps longer than the Anglo-Saxon countries where the crisis originated, the report said.

The warning underlines fears that Europe's path out of the crisis may be longer and more painful than many in the EU nations, since it has been slow to remedy its banks' issues.

Exactly right, I've been saying this for ages.

Creating bad banks and marking property loans to fantasy may help politicians get re-elected (Merkel is 10% ahead in the polls) and let a few bank CEOs live to fight another day - but sooner or later European banks will have to address the huge problems created by their twin exposure to US subprime and Eastern European bad debts.

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Dunno. See the above post from Evans-Pritchard in the Telegraph. Re : a weak currency can produce a swift export led recovery.

Well that's what I'm hoping for.

Only if you export far more than you import.

Now that 'invisible' earnings from the City are gone I suspect we are a net importer so a weak pound is bad for the economy.

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Exactly right, I've been saying this for ages.

Creating bad banks and marking property loans to fantasy may help politicians get re-elected (Merkel is 10% ahead in the polls) and let a few bank CEOs live to fight another day - but sooner or later European banks will have to address the huge problems created by their twin exposure to US subprime and Eastern European bad debts.

Yup.

The Euro is doomed.

Historically it's inevitable, the crash will just bring its demise forward by a considerable margin.

I think its probably got 5-10 years, depending what happens in next German election and more crucially the one after that.

The Eurozone has done a much better job of hiding the damage, as France and Germany have not p*ssed as much money up the wall over the last 10 years as Nu Labour did.

The US is F*cked for probably 5-10 years

We are F*cked for 10-20 years

But the Euro wont survive.

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Isn't OECD effectively run by the british government?

Given that its based in France, originally existed to distribute American money and has never had a British secretary general, I don't think so somehow.

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