Aufsätze Ökonomik

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Aufsätze Sozialethik


Prof. Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.

Abhandlungen über Johann Heinrich Jung-Stilling

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Too big to save principle also too big to rescue principle

Unless otherwise stated, this refers to the fact that a domestic bank is so large that it can no longer be rescued by the comparatively small home state. This is also referred to as a systemically important financial institution (Sifi). – Iceland’s Kaupthing Bank went bankrupt in 2008, dragging the entire country into state bankruptcy. The Union Bank of Switzerland (UBS) made a loss of CHF 20 billion and transferred toxic securities worth almost CHF 40 billion to the state in 2008: in total, almost a quarter of all federal tax revenues in 2009. According to reliable calculations, the insolvency of USB could have had a short-term negative impact on the national economy of up to thirty percent of gross domestic product. – In 2008, the two Dutch market leaders reported three times more assets than the entire state in the year. The major Dutch bank ING – short for Internationale Nederlanden Groep – had outstanding debts at mid-2010 that exceeded twice the gross domestic product of the Netherlands. In 2009, Spain’s gross domestic product was not even half of the sum lying dormant on the balance sheets of the three largest Iberian banks. – The picture is even more striking if you look at a country’s financial system as a whole. In the UK in 2010, the payment obligations of all institutions amounted to five and a half times the economic output; in Switzerland, they were six times as large at the same time. – The subprime crisis and the ensuing financial crisis have clearly shown that big banks can put their home countries in dire straits and even bankrupt them. – See banking supervision, European, bonus, proprietary trading ban, Icelandic bank trap, risk, systemic, feedback mechanism, Sifi oligopoly, sovereign wealth funds. – Cf. Financial Stability Report 2012, p. 98 (continuing dangers from the collapse of globally interconnected institutions).

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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
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