Europe’s commercial real estate owners, saddled with 1.9 trillion euros ($2.5 trillion) of debt, may be forced to make billions of euros in cash payments under planned laws that would treat them like hedge funds.
Catastrophic’
“That would be a catastrophic result for property businesses using derivatives like interest-rate swaps,” according to a European Property Federation study on the proposals. “Some would be unable to fund margin requirements and could default on their borrowings and risk insolvency.”
That kind of proposal may trigger an even bigger real estate crisis than the subprimes did with much worse consequences as EU states won't be able to put up a banking bailout plan of such a tremendous scale after the difficulties we saw to avoid Greece's and other peripherical's economies defaults.
We have to get the rating agencies to clear up fast the EU banks already stuck with hundreds of billions of risky sovereign debts and unable to meet the Basel capital requirements out of the way before they cause another catastrophy after we know the poor investments they have made contributing greatly to the subprime's problem....
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