Wilbur Ross on the Banking System

He discusses borrowed reserves versus equity, and coming bank failures:

 

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  1. JustinTheSkeptic commented on Mar 12

    Oh hell, another great reason for the market to overeact to the upside! Barry how come every time the market gets around the August lows of last year, Bernanke comes in with a big psydo-stimulus plan? Is there something magical about those levels?

  2. JustinTheSkeptic commented on Mar 12

    A snipet from an Article by Douglas Elmendorf, who is a former FED official

    “…More generally, a capable lender of last resort is likely to make money on its lending, because it steps in only when financial markets are sufficiently self-destructing that the feared assets are highly likely to increase in value when panic subsides. We may have reached that point regarding mortgage-backed securities in the U.S. economy.”

    Question: how many here feel that the FED will end up “making money,” on these pieces of crap paper?

  3. jck commented on Mar 12

    the fed won’t make or lose money on the “crap” paper because they are not taking that paper credit risk, they are taking counterparty credit risk on banks and primary dealers.

  4. John Borchers commented on Mar 12

    This is good gov’t consumer confidence up 4 points in last week. That’s great right?

    Except for this part:

    “Also, 53% of those polled said their own finances were in good standing, up from 50% in the prior week.”

    Only 53% of the people think there finances are in good shape out of 1000 Americans? That’s just plain old terrible! And some of those who think it’s okay probably aren’t okay at all.

  5. Chief Tomahawk commented on Mar 12

    Is The Big Picture going to blog it’s favorite “Client #9” t-shirts????

  6. D. commented on Mar 12

    Justin:

    It’s not stimulus, it’s prop-up!

    They are not making the bad debt disappear; they are just helping liquidity in a market that’s seizing up!

  7. Greg0658 commented on Mar 12

    cash (asset equiv) is cheap plentiful and hoarded

    is that Communism or the early reorganization years of Capitalism?

    how does the surf class pull the major dudes out of their mess?

    does our 21st century intellect; jihod embedded sentiment; … allow a civil outcome?

  8. John Borchers commented on Mar 12

    Humana down 25%. Even health care is not safe because of high drug costs.

    Inflation is everywhere and running wild regardless of what the core rate shows.

  9. Greg0658 commented on Mar 12

    ps – didn’t hit Socialism

    migrants and nomads; fed up with taxes and life as we know it (or incapable otherwise); de-evolving as a society; dumpster diving from tent suburbs

    next step forward; roundups incarcerations exterminations; for the greater good

    is that good for Cpitalism when the shelves and walls of a home have lost their luster?

  10. JustinTheSkeptic commented on Mar 12

    D, how come then, did the FED official say that there is a strong possibility that they will make money, if they don’t end up possessing anything? I’d sure like to be able to make money that way?

  11. Ross commented on Mar 12

    Hey Justin,
    It is possible but improbable the the Fed can make money on this swap. They will no doubt charge some nice fees and will probably continue to ‘roll’ the semi-toxic waste. Big ‘IF’ the dealers calm down and quit sniping each other, the Fed can ‘put’ the stuff back to them. I really expect them to monitize this slop. Wow, a new term…’swap a slop’.

    As pawnbroker of last resort, it will be interesting to see if they can tell gold from brass.

  12. 49er commented on Mar 12

    Someone should give the gov an eye exam.
    If I had a dog as ugly as Spitzer’s tart, I’d shave its ass and make it walk backwards. What a horse (whore’s) face.

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