Washington plans for big bank failure
Washington plans for big bank failure
A bill introduced in the Senate would give FDIC chief, Sheila Bair, a huge loan to handle 'emergency situations' in the banking sector.
NEW YORK (Fortune) -- The government is bracing for a big bank failure.
A bill introduced in Congress would give the FDIC, the agency that stands behind Americans' bank deposits, temporary authority to borrow as much as $500 billion from the government to shore up the deposit insurance fund.
The bill -- the Depositor Protection Act of 2009, backed by Senate Banking Committee Chairman Chris Dodd, D-Conn. and Sen. Mike Crapo, R-Idaho -- wouldn't change the status of individual bank accounts, which through the end of this year are insured up to $250,000.
But the Dodd-Crapo bill acknowledges what the financial markets have been signaling for the past month -- that the government must take the lead in a costly cleanup of the mess in the financial sector.
"I think it's a commendable start," said Simon Johnson, a former International Monetary Fund chief economist who tracks the crisis on his BaselineScenario.com blog.
Dodd said he introduced the legislation at the behest of other regulators, notably Federal Deposit Insurance Corp. chief Sheila Bair, Federal Reserve Chairman Ben Bernanke and Treasury Secretary Tim Geithner. All three recently wrote Dodd to support an emergency expansion of the FDIC's capacity to borrow from the Treasury.
"This mechanism would allow the FDIC to respond expeditiously to emergency situations that may involve substantial risk to the financial system," Bernanke wrote in a Feb. 2 letter to Dodd.
The Senate bill is being introduced at a time of rising market stress about the health of the banking industry. Seventeen relatively small banks have already failed this year and 25 went under in 2008. Last year's failures included the July demise of mortgage lender IndyMac and the September collapse of Washington Mutual, which was the sixth-biggest depository institution in the nation at the time it failed.
read the rest of the article here:
http://money.cnn.com/2009/03/06/news/dodd.fdic.fortune/index...
So are the Bankers...They are leaving town in droves!
Bankers Rush to the Exits
by Matthew Karnitsching and Heidi N. Moore
Wednesday, March 11, 2009
The exodus has begun.
A number of prominent investment bankers are fleeing major Wall Street institutions amid a bracing economic outlook, increased public scrutiny of their pay and mounting turmoil in their own offices.
More from WSJ.com:
• History Tugs Back Recovery Hopes
• Can Municipal Bonds' Rally Last?
• More Workers Cite Age Bias in Layoffs
Wall Street has announced tens of thousands of layoffs since the financial crisis worsened this fall. But most firms have managed to hold on to their top "rainmakers" -- veteran bankers with relationships that brought in revenues for bond deals, mergers and stock offerings.
That has begun to change, as the government's intervention in the financial sector has begun to spell the end of the freewheeling, big-paycheck culture that pervaded the firms.
The past week alone has seen the announcement of several high-profile departures: Jean Manas, head of Americas M&A for Deutsche Bank; Deutsche Bank media banker Fehmi Zeko; Goldman Sachs Group partner Joseph Ravitch; and UBS managing director Jeff Sine. They follow a parade of other senior bankers who have recently left big firms, including Robert Scully at Morgan Stanley, former UBS Vice Chairman Robert Gillespie, and George Ackert, the former head of Merrill Lynch's transportation group.
http://finance.yahoo.com/banking-budgeting/article/106717/Ba...
They are smart
I think mobs chased bankers trying to get on planes to leave the country during the Argentinian collapse.
The Dodd-Crapo Bill... Well,
The Dodd-Crapo Bill... Well, I think that just about sums it up!
Foreclosures and grrreeedy agendas killing the banks
U.S. foreclosures hit record level in February
By Simon Kennedy
Last update: 6:11 a.m. EDT March 11, 2009
Comments: 150
LONDON (MarketWatch) -- The number of completed U.S. foreclosures in February was 121,756, the highest monthly total since the crisis began, according to data from Foreclosures.com. The figure was a 67% increase from the 72,694 reported in January and was also well above the previous monthly high of 104,243 set last September. The number of pre-foreclosure filings also set a new monthly record, rising 24% to 207,703 in February from 166,860 in January. End of Story
http://www.marketwatch.com/news/story/US-foreclosures-hit-record-level/story.aspx?guid={A4C43DFA-9A0E-41CF-AECD-A8FEC114E43E}
Well, we really
can't be surprised by this it just indicates that it may be soon.
Prepare & Share the Message of Freedom through Positive-Peaceful-Activism.
Hyper inflation
I hate drugs, but those slack jawed feds needs ritalin like a chicken needs a cock!
Get Adjusted: From the Womb to the Tomb!