Tag Archives: World Economic Forum

Sarkozy: We Will Never Let The Euro Fall!

In a speech to some of the worlds most powerful businessmen, currently gathering in Davos for the annual World Economic Forum,  French president Nicolas Sarkozy was waving the EU flag, raising his voice and almost shouted out: “Ms. Merkel and I will never – do you hear me? – never let the euro fall!” I suppose everyone present could hear him – if anyone takes any notice is a completely different matter.

“To those who bet against the euro, watch out for your money because we are fully determined to defend the euro.”

Nicolas Sarkozy

“The consequences of a failure of the euro would be so cataclysmic that we could not possibly entertain the idea. We couldn’t even play with the idea of entertaining the idea,” president Sarkozy said in a key-note at the World Economic Forum in Davos (Switzerland), Thursday, as he tried to put an end to corridor speculations about the future of the euro.

Personally, I’m pretty sure the speculations will go on – perhaps even reinforce – after the French presidents latest outburst against those he sees as the evil speculators, trying to destroy the euro zone and its common currency.

Last year he claimed that the EU would use “a secret weapon” to fight the forces of the financial markets.

(Maybe it’s a superfast money printing machine?)

Anyway – according to Mr. Sarkozy, France and Germany have some kind of agreement to defend the “speculators” by all means:

The euro is Europe. And Europe spells 60 years of peace. Therefore we will never let the euro go or be destroyed,” he said, according to todays reports from Davos.

“To those who bet against the euro, watch out for your money because we are fully determined to defend the euro.”

“Ms. Merkel and I will never – do you hear me? – never let the euro fall.”

Failure Would Be Cataclysmic

“The consequences of a failure of the euro would be so cataclysmic that we could not possibly entertain the idea. We couldn’t even play with the idea of entertaining the idea.”

“To imagine that we might pull out, that we might abandon the euro, is to show a complete misunderstanding of the state of mind of Europeans who have been at each others’ throats for decades and who have only one thing in mind – peace and co-operation,” he said.

Adding that Europe’s identity is inseparable from the single currency.

“To imagine that we might pull out shows a complete misunderstanding of the European psychology. It has to do with our identities as Europeans.”

Well, some might argue theat it is the French president who shows a “complete misunderstanding” when it comes to the psychology and feeling of identity amongst Europeans.

Here’s the official video recording of the welcoming remarks by Doris Leuthard, President of the Swiss Confederation and Federal Councillor of Economic Affairs, and then; the opening address by Nicolas Sarkozy, President of France:

More at: http://www.weforum.org

It’s The Derivatives, Stupid!

He also took a swipe at commodity speculators, a growing theme of his tenure this year as chairman of the G20 and G8.

The president repeatedly pointed out that in the last few weeks he holds investors responsible for the rise in food and energy prices that have aggravated riots in some developing nations.

He criticised the derivatives market for the role he believes it played in the economic crisis.

“They played a ‘pass the parcel’ game which was, of course, very profitable because everyone you passed the parcel to made money – until finally there was no one to pass it to,” the French president says.

I would suggest that Mr. Sarkozy takes a few lessons and updates his knowledge of psychology and human behavior – not only the common, but also market behavior and psychology.

I can recommend a few books.

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A Euro Vacation (2010 Summary)

WilliamBanzai7: “Every January, the Global Ponzi Elite ascend to Davos Switzerland to congratulate themselves on the fine job they are doing of fleecing the rest of us.You will recall that the current Euro debacle started picking up steam precisely on the week of the Davos meeting this past January.”

Well, as we’re approaching The World Economic Forum of 2011, I guess it’s only appropriate to look back at what we’ve been through during 2010:

Vodpod videos no longer available.


The blogger WillianBanzai7 has caught may people attention this year with his artistic – and humorous – coverage of the financial crisis.


A visit to his gallery is highly recommended.

“Anyone who continues to claim that the global financial meltdown is an exclusive product of the good ol’ US of A is 100%, a certifiable douche bag on steroids. The same nefarious crew of Internationale Ponzi Globalists that availed itself of Bernanke and Geithner‘s bailout largesse when AIG hit the skids, is waiting to be saved yet again in Ireland. Meanwhile, the one called Deutsche Bank has already announced it’s intention to once again pay record banksta bonuses this Christmas. Merry Christmas (Fröhliche Weihnachten!) Europe!”


(The full post at www.zerohedge.com)

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The Nordic Superbank Dream

It’s been a dream and a vision for Nordic bankers for a decade; one big Nordic bank, strong enough to compete with the global giants in the international markets and at the same time protect their home markets from hostile intruders. Both Stockholm and Oslo have launched their candidacy to become a new financial center of the world. The plans got buried under the financial landslide of 2008, but now they’re being lifted back up by the major shareholder of the leading Scandinavian bank, Nordea.

“There are large uncomplicated savings through merging domestic banking operations. Unlike mergers across borders, efficiency gains quickly.”

Bjørn Wahlroos

Bjørn Wahlroos is chairman of the board with the Helsinki based insurance giant  Sampo Group who also is the major shareholder of the leading Scandinavian bank, Nordea. In a interview with the Swedish newspaper Dagens Nyheter, Monday, Wahlroos confirms that he’s planning on merging Nordea with another major Nordic bank.

In the interview he also confirm the market rumors that Stockholm based Swedbank is the most likely partner in the upcoming merger.

Exactly when the acquisition will take place is still in still kinda foggy.

“We are going to buy when it become financial interesting,” Mr. Wahlroos says.

The Finnish insurer Sampo has bought heavily into Nordea the recent years, and is currently the largest shareholder with control of 20.3 percent of the shares.

Sampo was in autumn given permission by the Swedish Finansinspektionen to increase its ownership to over 20 percent.

“I do not think we’ll exceed a 25 percent ownership,” Wahlroos says today.

Bjørn Wahlroos

However, the Swedish government owns 20% of Nordea and has signaled that it might be interested in selling the post.

And no one knows at this point what kind of deal the Swedish authorities finally will make.

“There are large uncomplicated savings through merging domestic banking operations. Unlike mergers across borders, efficiency gains quickly,” Wahlroos says.

The Slaughter And The Lamb

There has been rumors in the Nordic financial markets since last fall about a possible merger between Nordea and Swedbank.

In the spring of 2007 there was rumors about a merger between Swedbank and the Norwegian DnB NOR.

Of all the major Scandinavian banks, who all been pumping up the Baltic states over the five, six  years with tons of complex structured loans, Swedbank has made the biggest mess.

The bank reported a record loss of SEK 10,5 billion in 2009.

Wahlross admits that he has gone through the Swedbank’s results several times, and that he is still studying them – over and over again.

The Swedish newspaper writes that a possible merger between Nordea and Swedbank is a long way ahead, and argues that despite several opportunities during the financial crisis, the parties have not come any closer to an agreement.

Mr. Wahlroos says Sampo was contacted by Swedbank’s board already in autumn 2008 with an offer to join in to strengthen the capital base of the bank.

Swedbank also made the same request to Nordea.

“We knew that our tough conditions would probably be too tough for Swedbank –  and they were,” Wahlroos comments.

Christian Clausen

Last year, Nordea’s CEO Christian Clausen, said he was positive to a possible merger with Swedbank.

“I am not surprised that Swedbank once again makes the headlines as a good match for Nordea. Anyone who looks at our financial statements will see that this is a match,” Mr. Clausen said.

But added: “There are also others who are a good match.”

And indeed there is.

Practically any of the larger regional banks in Scandinavia would be a good match.

Who Is The Smartest?

In February 2007 I published a series of articles about the global financial service industry, and warned about what I described as a “financial earthquake”.

(At that point I was not sure how ugly things would turn out to be. I realized that three months later when I met up with Dr. Paul Wilmott and his gang).

The basis for my research at that time was a report from Mercer, Oliver Wyman; “Annual State of The Financial Service 2007,” released at the World Economic Forum in Davos a month earlier.

The report forecasts a wave of acquisitions and mergers within the industry.

Here’s what I wrote in February 2007:

“Banks that have already positioned themselves in the areas of the world with the largest and fastest-growing, primarily in Asia, will totally knock out the traditional commercial banks in terms of value growth. It is expected that growth in these areas will account for 40 percent of the total economic growth in the world over the next five years. Those who have not specialized, or is purely local banks, must therefore penetrate the international growth markets. If not, they will be eaten alive.”

“In other words; only the largest, strongest and smartest banks will survive.”

“The Scandinavian banks are too small to compete with the major global,” Stockholm based analyst Andreas Hakenson at UBS Investment Bank told me over the phone.

But pointed out that the Norwegian and Scandinavian banks can ensure growth by investing in niche products, such as shipping.

Hakenson also pointed at a weakness in the Norwegian bank system;  that they are so closely related to the domestic market where they have lived happy with the Norwegian oil-fairytale for many years.

The Scandinavian Dream

It was in the same series of articles Norwegian business veteran, former CEO of DnB NOR and chairman of the global fish farm company Marine Harvest, Svein Aaser, launched the idea of making Oslo the new financial center of the world.

Svein Aaser

Svein Aaser argued that the city of Stockholm already had drawn up plans for developing the Swedish capital into a global financial center, and that Norway had a much better odds of succeeding with such a plan.

“We have technology, we have the expertise and we have the money.”

“Unfortunately, we lack the political will,” Mr.Aaser said.

Svein Aaser and Bjørn Wahlroos seem to share a common dream.

The dream of a Nordic financial supermarket, serving the whole global financial community.

But this vision is likely to remain a dream.

However, it does not mean that all Scandinavian banks will be eaten alive by giants like BNP Paribas, Credit Suisse, UBS or Deutsche Bank.

Another main conclusion of the 2007 Mercer Oliver Wyman report is that size doesn’t necessarily matter.

“The big cap banks – with a market value of more than 50 billion dollars – had a smaller growth in the recent years compared to smaller, mid cap banks. The smoother mid caps have increased their market value by between 9 and 15 percent more than the big caps in the period from 2000 to 2005.”


According to MOW, surviving in the future world of banking means to always improve products and services, and quickly move strategic positions by placing money in the areas of the world with high growth and high risk.

“If one is to survive in tomorrow’s financial industry, one must learn to think like money,” president of Mercer Oliver Wyman, John Drzik, wrote in the executive summary of the report.

What is going on in the Nordic bank sector right now is much like a game of chess.

The players are sitting at opposite sides of the table, staring at the board, thinking (perhaps like money).

But at some point, one of the players will suddenly make a move and announce with a loud clear voice: Checkmate!

Who’s gonna get the honor of making that proud announcement, remains to be seem.

Whoever it might be – my guess is that it will be made sooner, rather than later.

Related by Economist:

Estonian Company Claims $130mill from SEB

“SEB Robbed Customers,” Whistleblower Says

DnB NOR’s Latest Fuck-Up

DnB NOR: “Comprehensive System Failure”

DnB NOR Except Penalties of NOK 26 million

Swedbank Buy Greek Bonds With Estonian Money

“The Baltic Lab Rat”

“Not Grounded In Reality”

The Relative Reality

How To Make A Rat Look Like A Puppy

Swedbank In Estonia: “Daylight Robbery”

Swedbank Reports Record Loss of SEK 10,5bn

Nordic Central Banks Agree On Baltic Bank Bailout

Baltic losses of Swedish banks at 3.7 billion dollars

How Sweden sent Estonian economy into free fall

Du allmektige bank!

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