US Financial problems ramping up - bank run?

fifthcolumn · Post by **fifthcolumn** » 17 Mar 2008, 13:35

The important question is this:
can they inflate away your tins of baked beans?

RenewableCandy · Post by **RenewableCandy** » 17 Mar 2008, 13:46

Ticker's down from 111 to 107 in the last 2 hours (presumably since the USA woke up this morning). Inflation might be orf, at least for the moment.

Papillon · Post by **Papillon** » 17 Mar 2008, 14:50

Markets also begining to recover (thank goodness), Dow's climbed back up after sharp losses earlier on, and is almost unchanged now, FTSE's down but climbing up now

I was getting worried some big names would star falling like domino's. So we can live for yet another day!

skeptik · Post by **skeptik** » 17 Mar 2008, 18:59

Papillon wrote:Markets also begining to recover (thank goodness)

After Bear Stearns failure and rescue over the weekend - share price from $30 to a rescue offer price of $2 - 'Why?' would be a good question. An artificial blip, methinks. Stand by to resume the downward trend.

It appears to me that the Ben Bernanke is offering up the Dollar as a burnt offering to appease the gods of Wall Street. Its obvious where his allegiance lies, and it's not to the wellbeing of the American people as a whole. The fundamental problems of malpractice, insolvency and loss of trust in the credit markets are not being addressed, merely covered up with FED loan sticking plaster.

His actions so far seem to me designed to keep the status quo of the financial system intact even if the outcome is the big Wall Street banks surrounded by huge piles of dead (metaphorically speaking - I hope not literally!) bodies, including the US economy.

syberberg · Post by **syberberg** » 17 Mar 2008, 19:03

skeptik wrote:
Papillon wrote:Markets also begining to recover (thank goodness)
After Bear Stearns failure and rescue over the weekend - share price form $30 to a rescue offer price of $2 - 'Why?' would be a good question. An artificial blip, methinks. Stand by to resume the downward trend.

It appears to me that the Ben Bernanke is offering up the Dollar as a burnt offering to appease the gods of Wall Street. Its obvious where his allegiance lies, and it's not to the wellbeing of the American people as a whole. The fundamental problems of malpractice, insolvency and loss of trust in the credit markets are not being addressed, merely covered up with FED loan sticking plaster.

His actions so far seem to me designed to keep the status quo of the financial system intact even if the outcome is the big Wall Street banks surrounded by huge piles of dead (metaphorically speaking - I hope not literally!) bodies, including the US economy.

Skeptik, won't that also have the effect of contracting the market?

skeptik · Post by **skeptik** » 17 Mar 2008, 19:33

syberberg wrote:
Skeptik, won't that also have the effect of contracting the market?

However it's sliced and diced, the US, UK and other bubble economies are headed for a period of contraction. All bubbles eventually burst. The problem has been apparent since August last year, yet the underlying causes have not been addressed, including Peak Oil, which, I think, has been a contributory factor.

danza · Post by **danza** » 17 Mar 2008, 19:51

Skeptik wrote;

After Bear Stearns failure and rescue over the weekend - share price from $30 to a rescue offer price of $2 - 'Why?' would be a good question. An artificial blip, methinks. Stand by to resume the downward trend.

It appears to me that the Ben Bernanke is offering up the Dollar as a burnt offering to appease the gods of Wall Street. Its obvious where his allegiance lies, and it's not to the wellbeing of the American people as a whole. The fundamental problems of malpractice, insolvency and loss of trust in the credit markets are not being addressed, merely covered up with FED loan sticking plaster.

His actions so far seem to me designed to keep the status quo of the financial system intact even if the outcome is the big Wall Street banks surrounded by huge piles of dead (metaphorically speaking - I hope not literally!) bodies, including the US economy

Spot on. The Fed is also expecting its money back in an economy starting a recession and housing market loosing value. Some forecasters are saying that up to 20% of the sub prime market could surrender their properties. e.g just lock the door and hand back the keys........

RenewableCandy · Post by **RenewableCandy** » 17 Mar 2008, 20:58

Bear Stearns are putting their prestigious HQ up for sale (says the beesknees pages of the Torygraph) worth $1.3Bn yours for only $0.9Bn-ish. Any takers? It would make a wonderful vertical garden!

SunnyJim · Post by **SunnyJim** » 17 Mar 2008, 21:02

skeptik wrote:
Papillon wrote:Markets also begining to recover (thank goodness)
After Bear Stearns failure and rescue over the weekend - share price from $30 to a rescue offer price of $2 - 'Why?' would be a good question. An artificial blip, methinks. Stand by to resume the downward trend.

It appears to me that the Ben Bernanke is offering up the Dollar as a burnt offering to appease the gods of Wall Street. Its obvious where his allegiance lies, and it's not to the wellbeing of the American people as a whole. The fundamental problems of malpractice, insolvency and loss of trust in the credit markets are not being addressed, merely covered up with FED loan sticking plaster.

His actions so far seem to me designed to keep the status quo of the financial system intact even if the outcome is the big Wall Street banks surrounded by huge piles of dead (metaphorically speaking - I hope not literally!) bodies, including the US economy.

Hmmm. After Papillion wrote that they dropped again. FTSE down 3.8% today....

SunnyJim · Post by **SunnyJim** » 17 Mar 2008, 21:52

From Robert Peston at the BBC.

UPDATE 11.35: Finance is global, so the shortage of liquid funds in New York has led to a shortage in the London money markets too.

That's why the Bank of England this morning offered ?5bn of emergency, short-term loans to British banks.

But here's the scary statistic. Our banks put in bids for ?23.6bn of these three-day loans.

Banks wanted more than four times what the Bank of England made available - which indicates they are not exactly flush with cash right now.

Little wonder the share prices of our leading banks are plummeting, with those of HBOS and Alliance & Leicester off more than 10%.

Wall Street's problem is our problem.

That's abit of a worry. Wonder which UK banks are in trouble????

SunnyJim · Post by **SunnyJim** » 17 Mar 2008, 21:59

Tomorrow sees Lehman and Goldman Sachs report first quarter earnings. Could be another interesting day in the markets

It was Bear Stearns report that saw to their collapse.

snow hope · Post by **snow hope** » 17 Mar 2008, 22:28

I get the feeling that the whole house of cards has lost a couple of cards near the bottom and the whole structure is wobbling.

It will either stabalize, although weakened until the next card falls, or the whole lot is going to come crashing down.

As some commentators have mentioned, you have to go back to the 1930s, BEFORE the Depression, to see analogous times. This is not a good omen.......

SunnyJim · Post by **SunnyJim** » 17 Mar 2008, 22:40

Yeah, looks grim doesn't it?

If the west collapses (continues to collapse) then I guess when we come out of recession/depression it would be because we had all started manufacturing stuff for the rising power of the east. The worm will have turned and we will be doing the manufacturing for the consumers of the east.....

Now, were did I put that lathe?

Papillon · Post by **Papillon** » 17 Mar 2008, 23:20

SunnyJim wrote:Yeah, looks grim doesn't it?

If the west collapses (continues to collapse) then I guess when we come out of recession/depression it would be because we had all started manufacturing stuff for the rising power of the east. The worm will have turned and we will be doing the manufacturing for the consumers of the east.....

Now, were did I put that lathe?

Yep, and soon, with global warming and all, the term 'English Breakfast Tea' might just mean quite literally that

Andy Hunt · Post by **Andy Hunt** » 17 Mar 2008, 23:23

So are we saying that China is going to bail out the Fed when it goes bust?