Studio Guest – Bernhard Jünemann on the loan crisis
- 00:03:01
- DW-World
Studio Guest – Bernhard Jünemann on the loan crisis
Bernhard Jünemann is Deputy Editor-in-chief of Börse-Online in Cologne. We talked to him about the US loan crisis. DW-TV: Let's pull in Bernhard Jünemann, deputy editor at Börse Online magazine. We've seen that the company Kühnezug is simply cutting back on expansion plans. It's not the only one. Lots of companies are worried about the near-term future. Are we going to see a bigtime slowdown in growth? Bernhard Jünemann: It could come to a slowdown, if there is really a credit crunch. But in Europe we haven't seen signs of a credit crunch yet. It's much more serious in the US. If the US growth really goes down, we might be affected. DW-TV: You say it's not quite as bad here, but a recent poll taken among banks in Germany shows that financial institutions have become much more cautious and reluctant with issuing new credit and loans to small and mid-sized businesses. The purse strings were pulled tighter last summer. What can be done to make the money flow again? Bernhard Jünemann: If it's really getting serious, then the Fed or at least the Central bank, the ECB, has one clear measure, lowering interest rates. the Fed has acted, they have lowered interst rates aggressively. DW-TV: The ECB has said it does not want to act. Bernhard Jünemann: Not yet...but I think in the end they might if the crisis is ongoing. But this is a means that they provide the banking sector with cheaper money and hope it transfers cheaper money to the companies. That hasn't materialised yet in the US. It will probably take at least 6 months. DW-TV: If the situation does not get better globally, the ECB is going to be pressured even more. When do you see it acting, and how much do you think it would cut interest ratein the eurozone? Bernhard Jünemann: It depends very much on the crisis and the euro, which is strong. If it gets stronger, the ECB will have to act, perhaps as early as spring - depending on how the crisis is developing. DW-TV: You sound a little bit like an optimist Mr Jünemann! The head economist of UBS says it's not so bad, no need to worry. A lot of the issue is psychology - we see a lot of this situation in grey terms right now. Bernhard Jünemann: Definitely. It's psychology. We have an acceleration in the crisis, we have one in the boom, where we overstate the chances. But to be prudent as a businessman- you have to take into account the worst case, and you have to be prepared. Interview: Brent Goff
DW-World | January 29, 2008
