Posted on 09/29/2008 8:21:31 PM PDT by DeaconBenjamin
The global credit crisis has slammed into Europe with stunning violence over the last two days, triggering five major bank rescues and a near total shut-down of the region's credit markets.
The Dutch-Belgian bank Fortis, Britain's Bradford and Bingley, and Iceland's Glitnir, were all partially or fully nationalized after failing to roll-over debts in the short-term money markets, while the French state pledged support for the Franco-Belgian lender Dexia after the share price collapsed on reports of a capital shortage.
"The European financial sector is on trial: we have to support our banks." said French President Nicolas Sarkozy. He has reportedly ordered the state investment arm Caisse Des Depots to shore up Dexia, even though the bank is based in Belgium.
Germany's Hypo Real Estate, a commercial property lender, was rescued with a €35bn lifeline from a consortium of local banks. The lender has $560bn in liabilities, almost as much as Lehman Brothers.
Hypo Real's share price crashed 74pc, setting off a masse exodus from financial stocks in Frankfurt. Commerzbank fell 23pc and Aareal Bank was off 43pc.
Anglo Irish Bank was down 44pc in Dublin on wholesale funding fears.
Europe's credit markets have come close to seizing up as three-month Euribor jumped to a record 5.22pc and OIS spreads rocketed to 113 basis points.
"The interbank market has collapsed," said Hans Redeker, currency chief at BNP Paribas.
"We're now seeing a domino effect as the credit multiplier goes into reverse and forces banks to cut back lending to clients," he said.
Mr Redeker said the latest alarming twist is a move by banks to deposit €28bn in funds at the European Central Bank in a panic flight to safety. This has jammed the mechanism used by the authorities to shore up the financial system in a crisis.
(Excerpt) Read more at telegraph.co.uk ...
I was thinking he is just aiming to do the same to the US in the last few days, but perhaps his sights are bigger than that.
And the ripples of the Do-Nothing Congress begin...
bump
Just saw Kerry lieing his head off on the O’Reilly show and O was too dumb to stop him.
I think the Euroweenies have been hit by a case of stunning hyperbole.
"Wall street crisis unleashes violent rampages across Europe..." ( "Ask for our ledes that will sell your newsprint.")
Does this make the dollar stronger?
The more the merrier. Misery loves company.
He knows how... and he's backing Obama. A meltdown pinned on Bush and the Republicans could be a Soros twofer.
Then again a clean rational bill will help us and everyone who lives here.
Oh Gawd. Is Bill O’Reilly still sucking up to those two?
Not to make light of Europe's difficulties, but Ambrose Evans-Pritchard has always struck me as a bit dramatic.
I always wondered just what Soros wants out of an Obama presidency. Does this guy thrive on third-world style Marxist politics?
Definitely a “sky is falling” narrative.
I’m quite convinced he’s trying to own the world. But God might have other plans.
Oil droped more than $5.
Another thing I heard today was their was a massive flight to US treasuries today by many local and foreign investors. 30-year treasury bond prices rose more than 3 points.
Today was not a good day for euro/global financials. British mortgage bank Bradford & Bingley was nationalized like Northern Rock.
Icelands government took control of Glitnier, the countries 3rd largest bank.
Parts of Fortis, a large european banking and insurance company, got a 11 billion euro injection from Belgian, Dutch, and Luxembourg governments which basically was another nationalization.
Yes, in all five European (3 in the Eurozone, one in Britain and one in Iceland) financial institutes had to be bailed out during the last couple of days.
Ambrose may well go under the name “Armageddon” Evans-Pritchad, but so far he has been spot on in his analyses.
In the race between the EU and the US towards the bottom, the EU will win that one hands down.
I don’t think Soros could care less about Øbama, nor about any other foot soldier. He wants to knock down the US to 3rd world status. We are witnessing in realtime the October surprise - a manufactured crisis, where the wants and desires of ‘rats, ‘pubs, msm, the ‘sleeping’ public watching TV, are all met in such a way as to put Øbama in there... a bloodless coup, for all intents and purposes.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.