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Goldfinger

Full - Blown Austrian Credit Crunch Ahead

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I thought this really deserves an own thread:

http://business.timesonline.co.uk/tol/busi...icle2017557.ece

The auction of New Look, the fashion chain, collapsed last night after bidders refused to meet a £1.8 billion reserve price set by its private equity owners Apax and Permira.

...

In recent weeks, several private equity firms have been forced to pull bond and loan financings, including a $1.55 billion (£768 million) offering by Kohlberg Kravis Roberts and Clayton Dubilier and Rice, to fund the acquisition of US FoodService, as the American sub-prime mortgage crisis made investors nervous of backing risky deals, including buyouts.

Problems with raising debt also caused Permira and Macquarie to pull out of bidding for Coles, the Australian retailer.

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I thought this really deserves an own thread:

http://business.timesonline.co.uk/tol/busi...icle2017557.ece

Doesn't anyone find it ironic that the countries whose economies are furthest from the Austrian model are the most successful.

e.g. Scandinavian countries, Germany and of course AUSTRIA.

If you include quality of life then the difference is even greater. Wasn't Austria fourth in the prosperity league but has the least dergulated economy in Europe (if not the world).

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"blip in the debt market"

maybe that's it?

Okay, I've done a Google search. For anyone like me who was unaware of the relevance of the word "Austrian" in the title, you will find your curiosity rewarded (or not) by this article on "Austrian" economic theory.

Can Austrian Theory Explain the Coming Credit Crunch

Don't you love learning new stuff? :)

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Doesn't anyone find it ironic that the countries whose economies are furthest from the Austrian model are the most successful.

e.g. Scandinavian countries, Germany and of course AUSTRIA.

If you include quality of life then the difference is even greater. Wasn't Austria fourth in the prosperity league but has the least dergulated economy in Europe (if not the world).

My family's Austrian on my mother's side so I know it very well. I've never understood how it remains so rich. Their society is amazingly cohesive. There's no bling, everyone seems to earn roughly the same, everyone seems to work.

And yet no-one seems to do any real work! It's the most rule-bound, bureucratic, back-scratching, cliquey place I know of. I'm obviously missing something.

Oh, and it's an incredibly boring place.

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Doesn't anyone find it ironic that the countries whose economies are furthest from the Austrian model are the most successful.

e.g. Scandinavian countries, Germany and of course AUSTRIA.

If you include quality of life then the difference is even greater. Wasn't Austria fourth in the prosperity league but has the least dergulated economy in Europe (if not the world).

Whilst the countries you mention are certainly not fiscal austrians, they are (or at least have been) monetary austrians.

In the case of Sweden you can see from the link that the currency has been tied to a collection of currencies through the years, in an effort to keep inflation at bay. The Bundesbank is widely regarded as one of the most successful central banks at providing stability through the latter half of the twentieth century.

Austria, in a similar fashion to Sweden has tied the currency to either the US Dollar or the German Mark since the 50s.

http://en.wikipedia.org/wiki/Monetary_policy_of_Sweden

http://en.wikipedia.org/wiki/Bundesbank

http://en.wikipedia.org/wiki/Austrian_schilling

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