Marv wrote: > What actual evidence is there that major banks like JPMorgan Chase, Bank of > America, and even Citibank (with the most exposure to MBSs) are starved of > cash and "mploding"? By all appearances, they seem to have strengthened > themselves at the expense of the defunct investment houses and weaker banks > like Washington Mutual.
Marv, At any point in time, the balance sheet of a bank is a testimonial to the tremendous power of faith and prayer. The absolute bulk of a typical bank assets are its time deposits. Totally liquid stuff. The only thing that keeps those deposits in their place is a thin layer of transaction costs and faith. Doug has a point. I think he pulls the stick a bit too much in the direction of the catastrophic risks to the point of believing that second guessing the bank rescuers is irresponsible. The risks are real, but let's not panic just yet. I just don't think that the average person in the U.S. is that bearish about the prospects of the country as to run and get their money out of the banks and stash it under their mattress or convert it into gold. If they see a few more big banks collapsing while the government sits on its pants, then all bets are off. _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
