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With the problems that Deutsche Bank as well as Volkswagen have, I wonder if the German management culture is really suited to a global marketplace.
Somehow I doubt there is any sort of substance behind that claim. No actual facts suggest that German firms are any more subject to corruption, deception or failure firms from any other country. My understanding based on discussions with people involved in the (low level) auto industry is that everybody is trying to game the emissions tests system, VW were just the biggest ones to get caught. As for Deutsche Bank, it is only the latest in a very long list of risk management failures in the banking world.
To answer the OP's question, I'm not going to claim that markets are always efficient but the company's stockholders clearly do not think the company's going to fail. The bubble burst but the stock price is as high as it ever was prior to 2010.
I think that the American management culture is more flawed. Just think of the collapse of Enron and WorldCom. Wells Fargo is a major American bank with a very questionable business culture.
There has been a problem ever since banks and investment houses were deregulated, and the problem has never been addressed, in spite of the deregulation causing a major economic crisis. This is alarming. Everyone is pretending that financial institutions are back to normal after the crisis, but the root cause of the crisis has never been corrected.
I only opened the thread because I had read reports speaking of that possibility, such as this one:
Quote:
Could Volkswagen go bankrupt over Diesel Gate?
Volkswagen could go bankrupt as a consequence of the scandal the manufacturer currently experiences. VW’s CFO Hans Dieter Pötsch dropped this bombshell this weekend. How can the world’s (once) second largest carmaker go under?
Though the scenario of Volkswagen going bankrupt isn’t highly likely, there is a chance the manufacturer is unable to recover from all the bad news surrounding it lately. Due to Diesel Gate, VW shares keep plunging, with another small decline today. With the diesel scandal being bigger than ever, it’s hard to say when this stops.
What a silly question. Of course VW will survive, same as Deutsche Bank.
Time will tell. At worst one or both will go under. At best, both have been hugely damaged.
I haven't really been following the VW story. But my daughter-in-law works for DB so I do get some of the inside story there and it ain't pretty. In addition, I know that one very big US investment manager has been pulling capital out of anything associated with DB due to the perceived risk. Market perception is likely to cause DB more damage than regulatory action.
There has been a problem ever since banks and investment houses were deregulated, and the problem has never been addressed, in spite of the deregulation causing a major economic crisis. This is alarming. Everyone is pretending that financial institutions are back to normal after the crisis, but the root cause of the crisis has never been corrected.
Yes it has. Deadbeats can no longer get mortgages. Credit for everybody and their dog was the problem.
The scandal in my opinion is just a giant mess, from all sides. From the US government side it is pure protectionism - not that anyone would care about gas emissions in between all the coal rollers and Cummins Pickup trucks - its just that if you could harm a foreign company that wants to enter the home market, you should do so.
"Shame on you!"
The only problem from a German perspective is that governments may change the rules for Diesel vehicles and increase taxes. So far, I enjoy driving Audi 3.0 TDI as long as I can.
Last edited by Douglas Dakota; 10-17-2016 at 08:58 AM..
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