That's happenning when someone let's the djinn escape the tiny bottle.
The phantom giant of Luxembourg Oliver Marc Hartwich Commentary Business Spectator
Wednesday, June 29, 2011
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Egide Thein comments on financial policies, financial services, offshore centers, bank secrecy, money laundering, terrorist financing, AML / CTF compliance, money transfers, tax evasion, fraud, corruption and on past and current events in Luxembourg and around the world.
It's incredible to see that once a person has acquired a reputation as a well regarded economist, he can start telling any nonsense and there will always be people to believe it.
ReplyDeleteSo the balance sheet of Luxembourg banks is supposed to be “eighteen times Luxembourg’s annual economic output”. The balance sheet refers to a stock whereas GDP is of course a flow over a year. Furthermore, the balance sheet of a bank is totally inappropriate to measure the default risk of a financial institution. In fact, the risks of Luxembourg banks mainly lie in the hand of their parent institution abroad and thus Luxembourg would not be hit by a banking crisis until the parent institutions were themselves in trouble. It is also utterly disputable on the methodological side, to compare the activities of an international financial centre to a country’s GDP. Financial services in the EU operate within the single market framework and not within national borders. But this is yet another story.
Fernand Grulms, CEO
Luxembourg for Finance
www.lff.lu