Posted on 01/23/2009 12:27:03 PM PST by Golddigger3
Banking regulators across the country are struggling with a new phenomenon: Banks are failing with accelerating speed, exposing holes in the regulatory infrastructure designed to catch collapsing institutions. . . .
Of the 25 banks that failed in 2008, nine toppled before regulators publicly cracked down, including IndyMac Bank and the banking operations of Wahington Mutual Inc., two of the biggest seizures in U.S. history. . . .
The problem illustrates a fundamental weakness in the country’s regulatory infrastructure. The government is positioned to help banks if there is erosion in their capital levels, referring to the cushion banks hold against unexpected losses.
But that isn’t what happened last year. Instead, many banks faced a liquidity crisis as customers and business partners lost faith, shutting off the banks’ access to short-term cash. [Have we already had runs on various banks?]
“In 2008, we have seen institutions fail with greater velocity than in prior years,” says Scott Polakoff, senior deputy director at the Office of Thrift Supervision. “That greater velocity is driven by liquidity crises, not capital crises.” . . .
“For the most part, I think it was a tidal wave,” says Rob Braswell, the top bank regulator in Georgia, where five banks failed last year. Only one was under a public enforcement action at the time. [If last year was a tidal wave, what will this year be since the loses are now seen as much, much greater]. . .
Liquidity kills banks faster than anything, and regulators just don’t have time to issue cease-and-desist orders and take formal enforcement actions,” says Jaret Seiberg, a Washington analyst at Stanford Group, a financial-services company. “We’ve seen banks die within a matter of days and weeks, You go from having a cold to buried.”
(Excerpt) Read more at online.wsj.com ...
I have my little bit of money at TD Banknorth and have been told since it is a Canadian bank it is immune to the problems here in the US. I cannot find any information about its trustworthyness or solidity. At least not on the net
Gun safe!
>>The problem is that the notional value of the worthless assets of any given one of todays institutional failures is equal to the entire value of failures of the S&L crisis... <<
OK, that’s kind of scary...
...misleading headline with even more misleading editorial comment. Everyone knows about the big investment banks that already failed.
Go ahead, though. Scaring others with baseless implications that local deposit banks are failing will help to end the trade imbalance regime and clear the way for more domestic manufacturing. Bring on the panics and defaults.
Thanks, I’ll have to work on that! kinda disconcerting chart though...
If don't acknowledge it or haven't seen it coming and prepared... hold on tight for the ride!
If you don't acknowledge it or haven't seen it coming and prepared... hold on tight for the ride!
My first double post.... My Bad ;-(
The article was about the entire banking system, including local and regional banks. All bank levels are receiving bailout money and are failing.
I had the experience of briefing an aerospace industry COO who had 60,000 people working for him and a salary of $20M/year. Every 15 minutes he made a decision that could make or lose millions for the company. If he made a lot of wise decisons, he was well worth it. One of his decisions resulted in the company earning an EXTRA $1.5B in profit on a bomber that we brought in ahead of schedule and under budget.
Good ETN info.....
I would be wary of ETFs too especially gold and silver ETFs. No way do they physically control the amount of gold that corresponds to what investors have put into those funds. They have paper claims on physical gold
Amen to that!
I see articles lauding the GLD ETF for always keeping almost 100% of the gold represented by the stock. Why do you doubt them?
Now if I can keep First Wife from finding it and investing it at one of the Casinos..
Many are to the point where they could care less about the banksters.
It’s so bad, many people are now hoping someone steals their identity, so the crooks can assume their debt.
Sounds like someone hasn't been candid with your.
They are scrambling to raise capital as well.
"Equity - Two Canadian banks sought to boost their capital reserves once more Thursday, issuing new preferred equity offerings"
http://www.canada.com/calgaryherald/news/calgarybusiness/story.html?id=09de84d9-d2e2-4e76-b06c-52c1a3d7b707
The Canadian government is also looking at setting up a bank bailout plan.
Remember to check those rates against my bank’s.
I use Mattress Savings and Loan.
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