Another weird Wagnerian word. It’s translated as “relief” in the libretto. Sieglinde “labt” Siegmund many times with mead in Act 1, Scene 1, of Walküre.
“Between the years.” The days between the end of the old year (Dec. 24) and the beginning of the New Year on Jan. 6, according to earlier calendars and older religions.
(TSVISH en dane YARR en.)
Feast days and the everyday (often called “the gray everyday”). Feast days make the everyday possible.
(FEST toggeh oont ALL tog.)
Syllabbreviation for the Deutsche Bank. Whose co-chief, Jürgen Fitschen, has apologized for phoning Hessian governor Volker Bouffier (CDU) after the Frankfurt district attorney’s 500-man razzia on 12/12 (but before the Munich district attorney’s 10-man razzia on 12/20, the latest Leo Kirch-related search of DeuBa premises) to complain that the Frankfurt district attorney’s 500-man razzia may have damaged the Deutsche Bank’s image. Fitschen’s phone call has been roundly condemned by German politicians in a [2011 Anglicism of the Year].
One expert has speculated that Fitschen fell on his sword so that duarch Anshu Jain can remain unfired. I’m wondering how the press learned about the phone call.
Süddeutsche Zeitung journalist Klaus Ott said the Deutsche Bank was warned by the Frankfurt D.A. last summer. “There was a sort of yellow card, a dark-yellow card, half a year ago, and the Deutsche Bank knew that if they didn’t cooperate there would be a search.”
Update on 03 Apr 2014: A blogger reviewing Michael Lewis’s new book on high-frequency trading mentioned an interesting relationship between the Securities and Exchange Commission, Deutsche Bank and the global financial crisis of 2008:
“The SEC’s head of enforcement, Robert Khuzami, was general counsel for the Americas for Deutsche Bank from 2004 to 2009. And who did Lewis reveal to be one of the biggest instigators of the subprime short and related CDO sales? Gregg Lippmann of Deutsche Bank, patient zero of this strategy. Any serious investigation of CDO malfeasance would implicate Khuzami.”
“Corporate penal code.” Green party member Jürgen Trittin has called for Germany to create laws punishing companies rather than their individual employees who can be shown to have broken the law. Trittin said the USA has such a code and therefore the Deutsche Bank, Germany’s largest bank, will be punished more in the USA than it will in Germany. His is not the first voice or political party to call for a German penal code for companies. Meanwhile, in the USA, people are furious about the slap on the wrist HSBC received in a settlement, not a prosecution, for alleged terror financing and drug money laundering so severe the boxes of cash were too large to fit through tellers’ windows, with ~50,000 accounts alone at one Cayman Islands branch that executed “virtually no oversight.”
An 11 Dec 2012 Spiegel op-ed noted that three major British banks have been required to pay large fines in the USA this year: Barclays, Standard Chartered and now HSBC. “All three of these large banks are based in London. That is no coincidence. Although in the past few years the American justiciary has taken aim at institutions from other countries, such as Credit Suisse, ING and JP Morgan, the British banks play a special role. They are traditionally set up more globally than their competition and have had business ties, sometimes for decades, in countries that are classified as ‘rogue states’ today.” Spiegel’s Carsten Volkery added that HSBC’s stock price has gone up by 14% since the summer, and Standard Chartered’s by 20%.
(OON ter NAY men’s SHTROFF rect.)
“Concrete gold.” Signs of an incipient housing bubble in Germany in statistics from ZDF heute journal, which reports that many investors, especially Greeks and Spaniards, are buying urban German real estate. They frequently pay in cash. Apartment sale prices are up 26% in Düsseldorf, 28% in Frankfurt/Main, 28% in Nuremberg, 50% in Hamburg and 73% in Berlin, according to the chart at 22:35. Financial reporter Sina Mainitz said low interest rates and uncertainty about the euro are helping drive the “flight into tangible property.” Unlike in the USA’s recent housing bubble, the Germans expect the ROI will be not from resale but from raised rents.
(Bay TONE gold.)
Something gentle and soft, like cotton balls or fleece. Online it is used as a virtual hug, a communicative equivalent of baby animal photos. It can take functional forms such as anonymous praise. German Pirates have been sending people virtual Flausches as a deliberate countermeasure to the Internet’s tendency to create [2011 Anglicism of the Year]s.
Third-party funding. Transparency International Germany is concerned about sponsoring agreements between German universities and the private sector. While state funding of university research has not substantially increased, total sponsor funding has doubled since 1998, and increased from 16% to 26% according to this Spiegel article. Sponsoring agreements are being kept secret, while sponsors can apparently get clauses allowing them e.g. to veto publishing of research results, insert op-ed material about their companies into university media, and nominate members of search committees seeking new faculty.
(DRITT mitt illll.)
Common bank supervisory authority. At this week’s summit to define a road map for structural economic reforms of the European Union, EU heads of state did agree on how to make the ECB a supervisory authority for European banks. Goals included ensuring similar bank monitoring quality across Europe and enabling more rapid identification of national banks that are starting to slide into trouble. Starting in 2014, the ECB will monitor only banks that are particularly large (balance sheet >30 billion euros or >20% of their country’s economic output but in any case each country’s three largest banks) and/or internationally active; currently this would cover the ~150 most important banks in Europe and ~30 banks in Germany. In justified cases, the ECB will be able to audit additional bank types, such as banks that have received financial assistance, and after the first indications of financial crisis the ECB should be able to intervene with all banks. The new authority will be mandatory for Eurozone members, with voluntary participation for other members.
Germany had objected that giving the ECB authority over all European banks (~6000) would leave German taxpayers on the hook for banks in other countries. France had wanted to give the ECB authority over all European banks in order, they said, to get the new system up and running more rapidly. As it is, more French banks than German banks will be subjected to the new ECB monitoring (President Hollande said 95% of French banks and 82% of German banks will probably be covered by the new authority). The new system is intended to cut links between national banks and sovereign debt, capping the tendency for some governments to issue too much debt and for their national banks to buy too much of it. They’re still discussing how to avoid conflicts between the ECB’s monitoring and financial policy roles. To separate the two functions within the same institution, it has now been agreed that a board will be created that does not include people involved with the financial policy side. When the ECB’s governing council, the highest financial policy board at the ECB, disagrees with the ECB’s bank monitoring decisions, an “arbitration mechanism” will be applied. Experts say much remains to be clarified.
The European Stability Mechanism (ESM) should be up and running in 2013. It will be able to send capital directly to troubled banks, with the prerequisite that it first unanimously asks the ECB to take over running them, and the ECB agrees to do so.
Update on 12 Sep 2013: The E.U. parliament approved the creation of a central Bankenaufsicht, being variously translated as a central bank oversight, a banking union, a single bank supervisor or single supervisory mechanism, that is intended to increase the world’s economic stability by being separate from national governments and national bank associations. It is to be at the European Central Bank but to be kept strictly separate there from other E.C.B. business, somehow, and now planned to be up and running by Fall 2014.
Update on 15 Oct 2013: The E.U., in the form of the Member States’ finance ministers, agreed on the basic structure of the Bankenaufsicht, to be indeed located at the European Central Bank. It will have oversight over ~130 large European banks. Startup is scheduled for ~November 2014. Tagesschau.de added that the Bankenaufsicht is the first of three planned “pillars” of the E.U.’s banking union [Bankenunion]. The other two pillars, “a mechanism for winding down rotten banks [marode Banken] and a uniform deposit insurance [Einlagenversicherung],” have still to be defined.
A stress test is scheduled next month for Europe’s 130 largest banks, because people remain concerned that some large banks might have managed to keep some risk mismanagement hidden in their books, even at this late date. Only after banks have passed the upcoming stress test, however strict it turns out to be, will they be allowed into the protection or at least under the umbrella of the new Bankenaufsicht.
Tagesschau.de’s Rolf-Dieter Krause commented about the upcoming E.U. stress test, “After rather doubtful exercises of this type in the past, this time they say they are *really* going to test the banks.”
(Geh MINE zom eh BONK en ow! ff zicked.)
“Value-added tax carousel.” On 12 Dec 2012 there was a razzia at the Deutsche Bank in which 500 finance police searched its offices and employees’ apartments in several cities for evidence of German Umsatzsteuer tax fraud for CO2 pollution permits sold abroad. Again, the scheme seems to have been to pass the paper back and forth across borders until it was unclear whether the tax due in Germany had been paid, after which the bank printed receipts saying it had and asked the German I.R.S. to refund, in this case, the 19% V.A.T. for the supposedly foreign transaction. Süddeutsche Zeitung described it as the government’s advance payment of V.A.T. to dummy companies that never paid it back and then evaporated. Trade in CO2 pollution permits shot up between 2008 and 2010, and the German fiscus refunded billions of euros to such schemes, according to the Bundeskriminalamt.
The Frankfurt general district attorney, who has been investigating this since 2010, voiced concern that Deutsche Bank employees, among other things, did not report suspected money laundering as they were required to. Germany’s largest bank, DeuBa garnered at least 230 million euros via the scheme.
The first razzia looking for evidence in this carbon emissions trading carousel scheme was carried out in April 2010 (and an unknown person warned the bank the day before). In December 2011 a decision by the Frankfurt District Court [Landgericht] listed instances in which the Deutsche Bank apparently did not care to ask questions about its business partners. Journalist Klaus Ott described some of them in an article in the Süddeutsche Zeitung dated 30 April 2012: “A business account for a furniture store that wants to engage in emissions trading? A business account for a company that doesn’t have any offices yet? A C.E.O. who doesn’t speak German but signs German-language bank papers with no prior translation? No problem! And what about the risk management documents of the company bringing in the new partner? The bank isn’t interested, even though it is well known that something stinks in this industry.” Spiegel-Online reported that in one case a ten-minute conversation sufficed to set up this million-euro deal. People behind the scheme appear to have been located in London.
Update on 20 Dec 2013: Europe’s carbon emissions market is merely ~100 billion euros, Süddeutsche.de wrote, but the continent’s “more vulnerable” “scarcely monitored” electricity and gas market is about nine times as large. It looks like the carousel tax scheme has been used there too, by Germany’s third-largest utility company EnBW but they’re not the only ones. Europol said that “criminals” used the carousel to avoid ~5 billion euros in value-added taxes in the carbon emissions market, but that the tax fraud may have been correspondingly higher in the bigger market.
The alleged electricity trading carousel was set up quickly, growing very large very fast. At EnBW, for example, tax auditors either found or made an in-house note that in 2011 “tax-free sales increased from circa one billion euros to ten billion euros within one year.” Germany’s F.B.I., the Bundeskriminalamt, was quoted as saying setting up the scheme required specialist expertise and in fact looked rather “organized.”
Süddeutsche.de indicated they learned these details from internal confidential papers from e.g. tax auditors in Karlsruhe and a central corporate I.R.S.-type office in Stuttgart [Zentrales Konzernprüfungsamt Stuttgart]. Europol, German prosecutors from multiple cities and German tax officials from multiple states are said to be investigating.
(OOM zots SHTOY err car OO! sell.)
Tacking, in sailing. Nautical metaphor used by the SPD candidate running against Angela Merkel in the upcoming German parliamentary election—his background is in ocean-oriented northern Germany. When pressured about unlikely coalition partners such as the libertarianesque FDP or Merkel’s CDU/CSU, Peer Steinbrück insisted he “would not tack” and said the SPD would only form a coalition with the Greens.
(Love EAR en.)
To tow boats. The world’s (temporarily) largest container ship, the “CMA CGM Marco Polo,” recently sailed into Hamburg with the tide. It had to be turned and moved into place rather quickly before the tidewater receded, and only a quarter of its 16,000-container capacity (in TEU, twenty-foot-equivalent units) could be shifted; advocates for deepening the Elbe river are using the visit as a PR action.
Larger container ships (18,000 TEU) are currently under construction in Korea for Maersk, and will ply the seas in 2013.
(Boog ZEEE ren.)
“You don’t have to be a genius to do this. Facebook offers simply too many points vulnerable to attack. And someone’s got to do it.”
Words from Viennese law student Max Schrems, who with “Europe vs. Facebook,” a group of about a dozen people, is working to get Facebook into better compliance with European data protection laws. After the Irish authorities declined to follow up on complaints Schrems filed, the group is now crowdfunding a lawsuit against the European authorities responsible for regulating the social networking company. They can’t sue the company itself, only its European regulators; but this lawsuit could be appealed all the way to the European Court of Justice. The group estimates the lawsuit will cost about 300,000 euros, of which they’ve collected 20,000 euros since the campaign started last week. Schrems’s legal activism uses 1200 pages of information collected by fb about him and his network of friends, including all his deleted posts, that he received from fb two years ago. He was inspired to request his data from the company after hearing an “absurd” presentation by one of its employees during a study abroad semester in Silicon Valley.
System-relevant banks, that are “too big to fail,” otherwise known as GSifi (global systemically important financial institutions). The head of the USA’s FDIC and a hohes Tier from the Bank of England published a proposal in the Financial Times on 10 Dec 2012 for reregulating system-relevant banks and making them less of a global economic risk. Under this proposal, if these huge banks got in trouble their top managers would be able to be fired by the responsible regulatory authorities, their shareholders would lose part or all of their investment, their creditors would not be able to collect all their unsecured debt, and rules would be applied to the company/ies at the top level of the holding hierarchy rather than the shuffle of subsidiaries. To promote national financial stability, healthy subsidiaries around the world would be preserved even if the top-level holding company is wound down. There are currently said to be 28 system-relevant banks in the world, of which 12 are in the UK and USA.
(Cis TEHM rellll ev ont eh BONK en.)
“To collect successful models.” E.g., the EU’s plan to implement Austria’s “youth guarantee” program to counter long-term unemployment in today’s young people. Looking around the EU and the world for government projects that work well, and then implementing similar projects in other countries.
(Er FOLLLGZ moe dell eh ZOM ellln.)
“Youth guarantee.” The EU is concerned about the high rate of unemployment among young Europeans under 25. They have announced a new program guaranteeing unemployed young people a job or education opportunity, saying that will cost less in the long run than the consequences of long-term unemployment. The guaranteed job, education, apprenticeship or internship is to start no later than four months after high school graduation if no job is found. This is an Austrian program that the government in Brussels now wants to implement across Europe.
(YOO gend garr on tee.)
“2,649 pieces of evidence” which have been collected in a report that will be used in preliminary discussions of another runup to an attempt at banning the far-right German political party NDP (“usually described as a neonazi organization“) for violating the German Constitution. Every failed attempt to ban the NPD apparently has worse consequences than if they hadn’t made the effort, which is one reason why Federal Interior Minister Hans-Peter Friedrich (CSU) said he’s skeptical about the current process. In 2003, the high court in Karlsruhe could not ban the NPD because too many people involved with the party and trial had been paid informants (V-people) for various government agencies. The current report has acknowledged that pitfall by collecting its 2,649 evidence items from public statements rather than testimony from potentially compromised witnesses.
On 5 Dec 2012 one of the small number of government institutions (Bundesverfassungsorgane, lit. “Federal Constitution Organs”) authorized to petition to ban a political party in Germany—in this case the state governors, who were also the group behind this report—unanimously voted to try again to ban the NPD. As Tagesschau.de explained in an online guide to this procedure, the hurdles for banning a political party in Germany are quite high due to lessons learned during the Weimar Republic.
Update on 22 Nov 2013: The federal states announced their petition to ban the N.P.D. party is now complete and will be submitted to the supreme constitutional court [Bundesverfassungsgericht] in Karlsruhe in early December 2013. The federal parliament, Bundestag, and federal government had decided not to join a new attempt at a ban, after failing to achieve one ten years ago before the court in Karlsruhe. The N.P.D. is currently experiencing financial troubles.
Update on 03 Dec 2013: The petition to ban the N.P.D. was submitted to the Bundesverfassungsgericht, which will decide whether to hear the case. Only two political party bans were ever issued in the Federal Republic of Germany, and both were more than fifty years ago, said ARD tagesschau.de legal correspondent Christoph Kehlbach.
(TSVYE t ow! zant, ZEX hoond errrt, N OY! N oond FEER tsig beh LAY geh.)
“Tax agreement.” Germany’s ruling CDU/CSU + FDP coalition negotiated an agreement with Switzerland that untaxed German money in Swiss bank accounts could be subjected to a one-time tax (21% to 41%) and repatriated to Germany with no prosecution for tax evasion. This agreement had to be ratified by German parliament but was not because the SPD and Green Party objected to the low rates, saying tax avoiders would be granted immunity yet pay a lower overall tax rate than people who had obeyed the laws. The matter will now undergo arbitration.
Update on 06 Dec 2012: A tax agreement between Greece and Switzerland is under discussion that it is hoped would return 9 billion euros to Greece. Again, the tax evaders would pay between 21% and 41% and remain anonymous. Negotiations have been ongoing for two years. Süddeutsche Zeitung reported that over 20 billion euros were moved from Greece to Swiss banks between 2009 and 2011.
Gerhard Schick, finance speaker for the Green Party in the Bundestag, said in a position paper quoted in this Süddeutsche Zeitung article about the constitutionally anchored tax-free status of Greek shipping families that the EU should be negotiating these tax agreements with Switzerland, that the Swiss tendency to negotiate separately with each EU country gives Switzerland disproportionately too much power. “Divide et impera.”
Update on 12 Dec 2012: Arbitration was unsuccessful.
(SHTOY err OBB come en.)
“Dividend stripping.” A tax avoidance scheme the HypoVereinsBank is accused of, wherein they allegedly transferred customers’ stocks back and forth between German and foreign banks until it was unclear whether the Kapitalertragssteuer had been paid and then claimed more capital gains tax credits than were owed. Reuters and the Süddeutsche Zeitung reported that a single Frankfurt investor working with HVB and other banks was told he owed 124 million euros in tax for 2006–08 after the IRS-equivalent refused to accept his capital gains tax break from the scheme; he has been fighting in court since 2011 to get HVB to pay the tax bill. HVB and this investor split the profits 65% HVB, 35% investor. Wikipedia says dividend stripping lost its tax-law basis in 2000, Spiegel says it hasn’t been accepted by German tax authorities since 2007, and Süddeutsche Zeitung says since 2012.
Weird story about the HypoVereinsBank in Spiegel-Online on 30 Nov 2012: A guy accused his ex-wife and other HVB employees of large-scale tax avoidance schemes that moved money to Switzerland, was declared non compos mentis by the Bavarian justice system and has been locked up in a mental institution ever since (2006). The man probably was violent, but he may have been correct about the tax avoidance. He cited names and numbers when he blew the whistle to the Bavarian tax authority, but a judge who was not involved in that case called the tax office and told them not to investigate the bank because the whistleblower was crazy. The institutionalized whistleblower’s case was re-opened in 2013. He was set free in the summer of 2013, after seven years of confinement. Laws committing people to mental institutions and keeping them there are going to be reformed as a result of his case. This started with an 05 Sep 2013 decision by the supreme court in Karlsruhe, the Bundesverfassungsgericht, which prioritized a review of the whistleblower’s case and announced failures of the various state courts and criteria that need to be met in future.
The Frankfurt district attorney’s HVB razzia last week found a trail leading to “a Swiss private bank.” Süddeutsche Zeitung says it is thought that Swiss banks will be a very fruitful place to investigate this German tax scandal. Deutsche Bank and UBS are now implicated as well.
Update on 16 Dec 2013: HSH Nordbank has been accused of dividend stripping.
(Dee veed END en shtrrrip pink.)
“To switch electricity providers.” Many industries in Germany have been granted electricity rebates that are ultimately being paid by individual consumers. Some policy watchers are concerned that electricity prices are rising so rapidly in Germany because consumers are on the hook for avoidable surplus costs. Competitive “market forces” are supposed to prevent consumer abuse, yet not enough people are switching providers for the utilities to change their behavior.
On 29 Nov 2012 ZDF heute journal said they’d posted a handy 60-second video showing how to switch to a cheaper electricity provider, and they broadcast a brief clip of it showing a timer counting down from 00:60 to 00:50 while a lady researched electricity prices and contracts. Yet I have searched and searched for this video and can’t find it. ZDF did have a similar video from 22 Nov 2012 online; this one is 2:10 long and only points out pitfalls to look for in the new contracts. Its general advice to consumers: agree to the shortest term possible, don’t pay in advance in case they go broke, beware low initial prices used as bait.
(SHTRRROAM on bee tah VECK cell n.)