Whoops! Germany Finds $79B in Math Screwup

'Bad bank' entered a sum twice
By Kevin Spak,  Newser Staff
Posted Oct 31, 2011 2:08 PM CDT
German Chancellor Angela Merkel, right, talks with Finance Minister Wolfgang Schaeuble prior to the cabinet meeting at the chancellery in Berlin, Wednesday, Oct. 26, 2011.   (AP Photo/Markus Schreiber)
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(Newser) – Good news/bad news time, Germany. The bad news: Your accountants might be incompetent. The good news: Hey, you’ve got $79 billion less debt than you thought! An accounting screwup at FMS Wertmanagement—the so-called “bad bank” set up to handle all the toxic assets from mortgage lender Hype Real Estate when it was nationalized—has had Germany believing its debt was significantly higher than it actually was, der Spiegel reports. A finance ministry spokesman says FMS accidentally entered one figure twice in its calculations.

That sure sounds like welcome news for a cash-strapped continent looking to Germany for relief. But Germany isn’t celebrating. “This is a very embarrassing mistake,” one economic scholar said. Finance Minister Wolfgang Schauble is reportedly furious, and many other politicians are calling for a full investigation. “Not just one person reviewed this balance sheet,” one high-ranking member of Angela Merkel’s party says. One German newspaper summed it up thusly: “As pleasing as the sudden bonanza might be, it’s trumped by the breach of trust.”

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