Posted on 05/17/2010 1:59:15 PM PDT by blam
Meredith Whitney: European Banks MUCH Worse Off Than American Banks, Second Half For Stock Market Is Bleak
Joe Weisenthal
May. 17, 2010, 3:18 PM
You've got hundreds of billions of recapitalization's needed in Europe, says Meredith Whitney, who is speaking on CNBC this afternoon.
And the fact that Europe is worse than the US is saying something, she says, since she's definitely still not positive on US banks.
Other than that, her interview appears to be a rehash of her op-ed arguing that financial reform will kill jobs.
"It could be very bad."
As for specific aspects of financial reform that concern her: pre-emption (rules that would allow banks to move to different states and take advantage of lower interest rates in some markets) and interchange fees regulation.
Specifically, she expects that interchange regulations will cream smaller banks to the benefit of the larger banks, hampering merchants' access to capital.
As for the stock market: The second half will be "bleak."
Why?
No end demand from consumers, and a double dip in housing.
Update: Here's the video.
[snip]
(Excerpt) Read more at businessinsider.com ...
It is a deflationary collapse, avoid all commodities except those that are seen as geopolitical and currency risk hedges: gold and (maybe) silver.
The Socialists and Monopoly Capitalists
I’ve seen this somewhere before!
Fact is, when they find a way to flood the market with fiat money, the commodities will go up simply because the fiat money is worth so little.
Gold is not worth any more than it was 30 years ago, but the dollars with which it is purchased are worth far less than they were 30 years ago.
And the fiat money is about* to take a HUGE hit.
*About=next year or so.
I have believed for a long time that we will be in a period of strong deflation. But at the same time, I also believe it will be followed by hyper-inflation. I think the deflationary side is starting to pick up steam. Heck, where I work (a quite large, and profitable company) someone in a large team meeting asked if the company was looking at across the board pay cuts. Before the VP could answer I said, “the last time that happened was in the 1930’s.”
The implications just sort of “hung out there” for a while before the VP said there were going to be no pay cuts.
Even though a strong majority of the bank bailout funds given to U. S. financial institutions ended up going to foreign banks, they still need more?
Good Golly, Miss Molly, they must have make a humongous number of bad bets on loans and mortgages and cr*p.
What’s the best way to short Euro money center banks?
Sorry...don't know.
If Whitney succeeds, the stock market will have a nice rally.
You can short DeutscheBank, BNP Paribas, and ING Groep on the NYSE. Or buy puts on them.
I wonder how this effects the Chicoms? I know they invested heavily in gold and silver, but they also invested hugely in things like copper, platinum, etc. These actions were taken as hedges against the dollar.
China has a housing inventory overhang of new never lived in units that is simply ENORMOUS ,, people buy 2, 3, 4, or more condo’s because they “NEVER GO DOWN IN VALUE” and because “I CAN GIVE IT TO MY CHILDREN SOMEDAY” ... I’m glad China was late to the game buying gold ... when they crash some will be selling but I think there will be quite a bit of buying after the initial wave of capital building..
China is pretty much screwed and already back in a bear market.
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