Tag: banks

  Moody’s released a report that would be headlines in the financial news media of any country that wasn’t in bed with Wall Street.

 The average maturities of new debt issuance by Moody’s-rated banks around the world fell from 7.2 years to 4.7 years over the last five years – the shortest average maturity on record.

 So how much is that in raw numbers? Banks will face $7 Trillion in maturing debt before the end of 2012, and $10 Trillion by the end of 2015.

  Those are staggering numbers, but it doesn’t end there.

 

Gee, it’s a good thing the governments rode to the rescue with billions of dollars in Corporate Welfare for the lying cheating fucktards who screwed everything up, no?

Otherwise, gosh, we would have had people not being able to buy bread, power shut off to everyone, riots in the streets …

No, we would have had the banks nationalized.  Which is what should have happened in the first place.

But here with the 1-year anniversary of the collapse, we are having a ridiculous level of retroactive propagandizing BY the criminals who fucked everything up in the first place.  The same people who STILL haven’t had any new regulations to control their activities, the same people who STILL haven’t faced any repercussions for nearly destroying the economy of the western world, are now expecting us to BELIEVE their bullshit about how they managed to dodge the bullet and keep us all from anarchy and starvation …

U.K. Faced ‘Bank Runs, Riots’ as RBS and HBOS Neared Collapse

This begs the question for me — why haven’t we had a run on the banks? Who in their right mind would continue keeping their money in banks?  How stupid are people?  Wait, I already know the answer to that.

“Hey, I know we almost destroyed the world economy, and took every dollar you owned with it, but hey, it’s all good now!  Trust us!”

Oct. 7 (Bloomberg) — A year ago today, Royal Bank of Scotland Group Plc and HBOS Plc were close to collapse, causing a chain reaction that could have ended with riots in U.K. cities, security analysts and economists said.

Bank failures would have forced the government to cancel police leave and deploy troops as the breakdown of the financial payments system threatened the ability of utilities to provide essential services, said David Livingstone, a fellow at the Royal Institute for International Affairs in London, a former adviser to the government’s Cobra crisis response committee.

“You are talking about a situation with mass disorder and panic,” the former Royal Navy officer said in an interview. There would be “riots, pandemonium, everyone fending for themselves.”

Chancellor of the Exchequer Alistair Darling, Bank of England Governor Mervyn King and Financial Services Authority Chairman Adair Turner met at 5 p.m. on Oct. 7, 2008, and readied a 250 billion-pound ($398 billion) rescue for the banks in the 16 hours before they opened for business the following day. In response to a Freedom of Information Act request from Bloomberg News one year on, the Treasury declined to say if it had a contingency plan for the two banks, then or now.

Releasing such information would probably “have a destabilizing effect on financial markets,” damage the government decision-making process and cause commercial harm to the banks involved, the Treasury said in a letter.

“In the current economic climate, economic perception, even if totally misconceived, is important and has the capacity to alter market behavior,” the government said. “To confirm or deny whether or not the information is held, either in relation to the banks mentioned in your request or more generally” would hurt the banks and the U.K.’s economic interests.

‘Catastrophic’ Costs

The crisis last year was the worst Britain had faced in peacetime, Darling told the British Broadcasting Corp. last month. The two banks were not “confident they could get to the end of the day,” on Oct. 7, King told the same program.

“You would have had unmitigated panic and a bank run,” said Tom Kirchmaier, a fellow at the London School of Economics. “People would not have been able to buy bread. The cost to the economy would have been catastrophic.”

RBS and HBOS, then in talks to be taken over by Lloyds TSB Group Plc, had more than 35 million business and individual customers with 475 billion pounds of deposits, 22 percent of the U.K. total, held at about 3,250 branches.

‘Contagious Effects’

“If RBS hadn’t been propped up as it was, in practice it would have been nationalized the following week,” former Bank of England deputy governor John Gieve said in a Bloomberg Television interview. “If RBS, HBOS, Lloyds had gone down, that would have had huge contagious effects throughout the rest of the world.”

The failure of Edinburgh-based RBS and HBOS would have had a domino-effect with customers seeking to take out their deposits from other lenders and causing a wider run on U.K. banks, said Vicky Redwood, an economist at Capital Economics Ltd.

“Trust in the banking system would have completely collapsed” and would have generated civil unrest, said Redwood. “People would have been rushing to take their money out of the other banks and you would have been heading back to the depression era.”

From Reuters today we read that bonuses paid out by banks exceeded total revenue.

What?! you say?.

Bonuses paid to executives at nine banks that received U.S. government bailout money in 2008 were greater than net income at some of the banks, the office of New York Attorney General Andrew Cuomo said on Thursday.

For all of us who are (ahem) less than satisfied with the vigor of the US Federal Government’s prosecution and enforcement of banking laws against large financial institutions, the US Supreme Court on Monday bucked 145 years of tradition to deliver an important and far reaching opinion that falls squarely on the side of greater accountability.

In Cuomo v. Clearing House Association (PDF), the court struck down a regulation by the US Treasury Department’s Office of the Comptroller of the Currency (OCC) that prohibited enforcement of state banking laws against national banks.

The case involved an attempt by former New York Atty. Gen. Eliot Spitzer in 2005 to investigate bank lending practices, such as whether a disproportionately large percentage of high-interest mortgages were made to minorities.

After Spitzer sent letters of inquiry to national banks, including Wells Fargo & Co., Citibank and JP Morgan Chase & Co., a bank consortium called the Clearing House Assn. filed suit to stop the investigation.

The Treasury Department’s Office of the Comptroller of the Currency, which regulates national banks, also filed suit, arguing that Spitzer was improperly encroaching on its rule under an 1864 law that it was the only entity with the “visitorial power” to examine such banks. The suits were combined and upheld by lower courts.

But Spitzer’s successor, Andrew Cuomo, appealed to the Supreme Court, arguing in part that the federal agency’s interpretation in effect shielded national banks from states’ enforcing their own laws to protect consumers and prohibit discrimination.

 The Jurassic Senate of the GOPosaurs and DINOsaurs is a fucking disgrace. Don’t blame Obama, blame these craven, weak kneed traitors to their nation.

   I only discount Ted Kennedy and Al Franken for obvious reasons, as well as Bernie Sanders, who votes more like I would than any other Senator. If you think your senator should get a pass here give me a good reason why,.

   The rest of the Senate can go fuck itself.

   That’s right. The Senate has sold out to the banks, the insurance companies, the special interests, anybody with a dollar gets their time.

    40 GOPosauars who say “No No!” , 55 DINOsaurs who say “Not Now!”, Arlen Specter trying to remember which side he is on today and whatever the hell Joe Lieberman is skittering across the wall.

   The Conservative status quo sets the tone in Washington and in the MSM. The GOP sets the obstruction agenda, plain and simple, and I hope you are with me when I say I have had enough.

(P.S. – thank you Buhdy for putting this on the FP, when I saw the words

the Senate can go fuck itself.

I had to laugh.)

Cheers

Crossposted at Square State

There is a lot of talk about the way which we need to go in order to fix our current very serious problems in the financial sector and the economy in general. There can be very little doubt one of the major causes of our crisis is the repeal of the Glass-Steagall Act in 1999. Now the Dog knows that some of his reader’s eyes are going to glaze over when the old hound starts to talk about economic policy, but he promises not to make it too dry and boring. Besides, none of us can really have an informed opinion if we don’t wade through this stuff.  

Unbe-fraking-leavable! Just when you think you know what the hell is going on and have some idea what it will take to get things back in shape, a new shite storm comes sailing along to bring you a new life-time supply of manure. What has the Dog so spun up this afternoon? Well, are you sitting down, gentle reader (duh of course you are, you’re on the internet)? The FDIC is going asking to be able to borrow $500 billion (as in five hundred thousand million) dollars, because it is does not have enough money to do the heavy lifting of taking over a bank like Citi or B of A.  

No one likes to admit that they were wrong. This seems doubly true on here on the great inter-toobs, but the fact is that the Dog was wrong. It is only in one case (at least he is only going to cop to one case right now!) but it is a pretty major issue that we face right now. What is this issue? It is the case for nationalizing failing Banks. When this was first discussed, the Dog perhaps like a lot of others, assumed that we were talking about a complete and total take over of the banking system by the Federal Government. That would be something akin to the Venezuelan government taking over their oil industry.