E Weimar II

The USA is turning into the Weimar Republic. On the one hand we have a fervent nationalist and on the other a righteous socialist. Both of them have weird hair and, unlike their German predecessors, are not magnetic orators.

But it is still scary to someone bi-cultural. I was raised by parents who had lived through Weimar and the rise of Hitler and always voted for mainstream candidates, even when a neighbor of ours was head of the US Communist Party, and even when changing demographics brought Latinos to what had been a German-Jewish enclave in northern Manhattan. They avoided leftism and jingoism from experience.

Viscerally, I am frightened by what is happening in the primaries. Hitler came to power via an election, not a coup d’état?,? after a period of economic upheaval.

For good news, the price of oil is inching up again. And the market has decided that Deutsche Bank is not likely to default on its coco contingent convertible bonds.

So we do not have to try to find the equivalent to Hjalmar Horace Greeley Schacht, the head of the Weimar CB who supported Hitler in opposing reparations payment (and even campaigned on this during a visit to the USA.) But

?he ?quit the Nazi government over German rearmament after the invasion of Czechoslovakia. He also argued against “unlawful activities” after the Kristallnacht attacks against Germany’s Jews, and tried to work out a way to allow Jews to leave Germany with assets the Nazis wanted to sei?z?e.
This might have

?been ?expected from someone bilingual in English and named after an American newspaperman by a father who had lived for decades in the USA. He was, moreover, born in Schleswig-Holstein, then German, but now Danish, and was Catholic in a land of Lutheranism.
Schacht linked up to the anti-Nazi resistance as early as 1941 although he was kept on at the Reichbank after the US entered World War II, mainly because Hitler feared the impact of his leaving. He was only ousted early in 1943.

Schacht was arrested and put into a series of concentration camps after von Stauffenberg in July 1944 failed in his attempt to assassinate Hitler. Liberated by the US 5th Army he was tried at Nuremberg for “crimes against peace”, but not for “crimes against humanity”. But he was acquitted from charges that he had planned or waged wars of aggression. He later founded a private bank specializing in loans to developing countries as he had worked with many of their banks during the Weimar years to try to keep the Reichbank afloat by accepting payment in Reichmarks rather than dollars.

 Mr Schacht worked for Dresdner Bank rather than Deutsche Bank as a young man. DB stock rose 14% this morning on news it is buying back some coco debt.

*CAE reports oddly, in C$s and for a fiscal year running to March 31. It reported today that revenues rose 10% to C$616.3 mn in Q3. This was below the Capital IQ consensus of C$626.5 mn. However profits, or what the company called net income before items, came in at C$59.4 mn or 22 loony cents/sh vs consensus of C$52.1 mn and 20 loony cents, a nice surprise. Items mostly were over restructuring?.? Profits also were up 14% year/year.

CEO Marc Parent at the maker of aviation and medical simulators forecast that CAE is “well on track to meet our positive outlook for the fiscal year [2015-6]. In civil, we expect to surpass our previous full-year outlook for sales and look forward to solid growth and a higher margin. In defen

?s?e, our YTD performance, robust pipeline, and order backlog support our outlook for growth.”
He also noted that free cash flow was C$200 mn up on 2014-5. Return on capital employed in Q3 hit 11% vs 10.5% a year earlier, and debt fell dramatically to C$794.9 mn from 971.7 mn in the prior Q3 or 29% of capitalization from 38%.