BASF not worried by subprime mess
A new estimate predicts a $400-billion hit in subprime write-offs. But Jurgen Hambrecht says if banks simply worked the way European manufacturers did, there would be little cause to worry. Stephen Beard reports.
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TEXT OF STORY
Doug Krizner: Over the weekend, finance ministers from the G7 predicted more losses from the subprime crisis. Total bank write-offs could reach $400 billion -- that's almost three times what the Fed's predicting.
But while G7 leaders are gloomy, one German industrialist is very upbeat. Stephen Beard reports.
Stephen Beard: Jurgen Hambrecht runs the world's biggest chemical company, BASF of Germany. He is not showing any signs of German angst. Quite the opposite -- he's very optimistic about the year ahead.
In an interview with The Financial Times, he attacks the banks for what he calls "panicking" over the credit crunch. Hambrecht says many manufacturing companies have a big backlog of orders.
His confidence is echoed in a survey of European industry commissioned by Andrew Smith of accountants KPMG.
Andrew Smith: The survey found that more than half -- 56 percent -- of European manufacturers expect their output to grow this year. Only 12 percent expect it to fall.
In his interview, Jurgen Hambrecht takes another side-swipe at the financial sector. The chemical company boss says the banks could learn a thing or two from manufacturing, like how to simplify their products.
In London, this is Stephen Beard for Marketplace.
