Bank blood letting.

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RBS has lost a quater of its share value in the last two weeks. Not far off 10% in the last two days. The British tax payer has so far lost 50% of the money, our taxes, that the government invested in it.

Commerzbank in Germany just announced a 93% drop in profts due to ‘impairments’ on exposure to Greece.  Can’t wait to see what ‘impairments’ they declare in a couple of months time due to exposure to Italy and Spain.

Intesa Sanpaolo in Italy is down 11.74% on the day on massive trade volume. A share of Intesa is now worth 1.16 euros which is lower than in October 09.

UniCredit in Italy is down 8.81% on the day, trading now at less than 1 euro.

In France:

Credit Agricole        – 14.12%
Societe Generale      – 13.82%
PNB Paribas            – 10.42%


In America:

Bank of America has lost lost $33 billion of its market value in a single week.  Unless these losses are magically erased by spectacular gains, and soon, we will see forced selling of assets as banks try to raise capital.

17 thoughts on “Bank blood letting.”

  1. Sean

    Well we have had 3 years since crash mk1 and really the question is now that total bank collapse is on the cards, the powers that be regardless of colour or purity are going to have put in place some sort of plan for such a situation. Unless of course they are completely barking and not war gamed the possible outcomes, which i think is unlikely.

    2 things I think we will see is all banks placed into administration after that capital controls, not sure what else.

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  2. Neil

    1715: BBC political reporter Ed Lowther reports that the first e-petition to pass 100,000 threshold looks set to be one calling for rioters to lose benefits: it's at 78,000 signatures and needs to get past 100,000 for the backbench business committee of MPs to discuss whether or not to call a Commons debate on it.

    Reply
  4. mikehall

    @ Sean

    Although the banksters seem quite happy to play what appears to be a dangerous game in brinkmanship, I doubt very much they will risk an actual collapse.

    I velieve it was no accident to integrate a dangerously unstable, avalanche risk of an approx. $700 trillion derivatives market (leveraged casino) into the high street banking system. It's proving a very powerful weapon in driving policy against debt restructuring (aka default, aka let the gamblers feck off with their own losses).

    Their play is to push public policy makers to effectively accept transfer of the debt obligations onto public institutions, taxpayers etc. via so-called 'bail outs' or other means. Governments (or gov. backed ECB) will then borrow the funds needed for this from the banks. Win-win for banks – money created as debt (in their favour) IS their business. It might well come to more 'QE' rather than borrowing, but again this will be handed to the banks.

    There's no reason at all for a currency issuing government or authority to borrow to create funds or to hand out QE to banks. But the system is so 'captured' by neo-liberal ideology, that the far more useful QE of spending direct into to the economy (via gov programs investment etc) will likely not be considered. (Banks will do all they can to discredit this perfectly viable option, as it's profoundly against their future interests to allow this moggie out of the bag.)

    Another concurrent play is to force austerity policies, drive down the price of labour & also aquire public (often monopoly) assets at bargain prices.

    In short, economic warfare on society by the financial sector.

    @ steviefinn

    Brilliant blog on the riots here by (MMT) economist Prof Bill Mitchell

    http://bilbo.economicoutlook.net/blog/?p=15605

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  5. forensicstatistician

    If another credit crunch ensues and we are held to ransom again to bailout the banks, we need a million strong march by the public with one simple & clear message:

    "No more banker looting in the UK's streets"

    Imagine if everyone on the march carried a broom aloft their heads – the symbol of sweeping out the poisonous infestation in our nation.

    Reply
  6. mikehall

    @ forensicstatistician

    +1 ! (& repeat all over europe)

    This is what I want to see:

    http://www.positivemoney.org.uk/wp-content/uploads/2011/07/Submission-to-ICB-4-July-11-Positive-Money-nef-Soton-Uni1.pdf

    One thing that has struck me about the budget setting procedure in this (essentially 'MMT' system) is that there is a much more robust mathematical basis for what a budget adjustment needs to be. (With of course the actual size of a deficit being irrelevant, as it should be for a sovereign currency issuer.)I would see the ideal process involving a number of stages, to-ing & fro-ing between gov & an MPC, with proposals in public view, & discussed in the media etc. MPC needing to ultimately sign off on the maths & quantify likely distributional effects. The latter ultimately the responsibility of elected government to determine. I think this would make the macro economic policy decisions of government (& politicians) much more transparent & generate a lot more understanding & engagement by the public (hopefully).

    ie rather than the parallel universe of ideological bull sh1t & economics illiteracy currently

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  7. steviefinn

    @mikehall, thanks for that, brilliant stuff, kinda reminded me of my teenage years in the early 70's.

    Here's a link to an insightful article that has some interesting statistics, like the fact that if you travel the 6 miles from Kensington to Newham, the life expectancy goes down from 78.5 to 72.4, a larger gap than that between the US & Nicaragua. We have a society within a society.

    http://roarmag.org/2011/08/london-calling-a-haunting-glimpse-into-our-future/

    I am going to contact Massive Attack & see if I can get some support for our petition, a long shot probably, but worth a try.

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  9. mikehall

    @ FS

    Thanks, I've already seen it on realnews.com (well worth putting yourself on their email list if you're not already)

    Another snippet on Bill Black – he was a US regulator during the S&L crisis, largely credited with jailing over 1000 execs for control fraud.

    He's publicly accused execs in major US banks of fraud this time around. Funnily enough, none seem too keen on suing him for libel, wonder why?

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  10. Skint.Teacher

    Reading how much money the UK tax payer has lost due to the falling share prices got me so wound up that I immediately went and posted about this article on my blog. This kind of information needs to be in the public domain and discussed and leaked to ensure that the British tax payer knows what a mess has been made.

    Skint.Teacher

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  12. mikehall

    @ FS

    Unfortunately the video (wikio.com..) you link is 'no longer available due to copyright yada, yada…"

    Censorship by MSM? (would hardly be surprise lol, another badge of honour for Bill that authorities feel the need to suppress his views perhaps!)

    RNN has masses of interesting pieces on their 'Economy' archive section, with interviews with top notch experts. Well worth a trawl. One expert I recall may be of particular interest to you (reading your ICB submission) is Jane D'Arista. Quite a few pieces on her work on financial reform in the US, Fed operation & much more, plus another series with her on 'casino capitalism.

    http://therealnews.com/t2/index.php?option=com_content&task=view&id=238

    @ All

    May I commend a good article by a fellow citizen of the Emerald Isle, Philip Pilkington, over on nakedcapitalism.com ? (Yves Smith's excellent blog site.)

    http://www.nakedcapitalism.com/2011/08/philip-pilkington-european-citizens-are-not-being-taxed-to-fund-the-bailouts.html

    If, by any chance, Philip, you read this blog, can I say thanks for a great article & great to see someone living in Dublin who 'gets it' ! Keep going please, I do hope to see more of your superb writing & understanding in Irish media.

    And huge thanks, while I'm at it also to Golem, FS and all the others for your time & efforts blogging. We'd know feckall if we had to rely on MSM.

    Reply

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