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> On Jan 3, 2011, at 4:33 PM, dredmond at efn.org wrote:
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>> So 13% of their loans take a haircut, the rest are reasonably solvent.
>
> 13% is a lot in a leveraged business like banking. Deutsche Bank has $2.153 in assets and $2.100 in liabilities, leaving stockholders' equity of $53 million, or 2.5% of assets. This is one reason why Germany is so eager to make the people of Ireland and Greece suffer.
The financial columnist Ambrose Pritchard-Evans of the Daily Telegraph, who has been forecasting a catastrophic global depression since the onset of the financial crisis, had this to say about the European banks last year:
"En plus, Europeans account for an astonishing 74pc of the entire $4.9 trillion portfolio of loans to emerging markets. They are five times more exposed to this latest bust than American or Japanese banks, and they are 50pc more leveraged (IMF data)."
Starting if true. Anyone know precisely what "IMF data" he was drawing on?
No. But somebody else has probably answered that question by now anyway.
I just wanted to say that as far as I know, Lehman Brothers bank was leveraged at around 44%, while the other 'more cautious' investment bankers were at about half that rate. This was, of course, just before the shit hit the fan in '08.
BTW, the decline of the USD is helping the Yuan undersell commodities in various markets of the world as its price is tied to the USD's price.
Carry-on, Mike B)
Mike B)
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