[The Independent, U.K.]



Libération, France

French Banks Shouldn't Act Like Goldman Sachs


"Like Goldman Sachs, BNP Paribas is extremely profitable, but do its profits and bonuses benefit the real economy?"


By François Sergent


Translated By Sandrine Ageorges


August 7, 2009


France - Liberation - Original Article (French)

Writing about the banks on Wall Street, Nobel laureate in economics Paul Krugman could have been talking about BNP Paribas in France.


"The American economy remains in dire straits," he wrote, "Yet Goldman Sachs just reported record quarterly profits - and it’s preparing to hand out huge bonuses …this tells us that Goldman is very good at what it does. Unfortunately, what it does is bad for America."


Like Goldman Sachs, BNP Paribas is extremely profitable. But do its profits and bonuses benefit the real economy? We know the crisis is largely due to the "financialization" of the economy, which has been transformed into a casino without any connection to the creation of wealth. Everything has become a financial product of benefit only to banks and traders.


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The bonuses, as they are calculated, maintain this economic fiction. And they do so without risk, since the state stands behind them in case of any problems.  



A good portion of the much trumpeted gains claimed by BNP Paribas come from Fortis, a Belgian bank purchased on the cheap. So when BNP Paribas realizes its profit growth, the Belgian as well as the French taxpayer are the losers.


Today the head of BNP Paribas said to wants, "to wait until the end of 2010 to decide on repaying state-provided assistance." Is this a question of some audacious formula he intends to offer clients who, like him, are having difficulty scheduling their loan payments? Rather than reward these traders who have become bounty hunters, wouldn’t it be better to use these reserves to reimburse the French who saved BNP Paribas when everything was going wrong?






























[Posted by WORLDMEETS.US August 12, 6:20pm]



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