Bank Losses
Research Recap had a short story on the losses of major banks from mortgage securitization. A summary of the losses by bank is shown below. Note that this week's $12 billion loss at Royal Bank of Scotland is omitted.To put these losses of approximately $218 billion in perspective, the losses are comparable to the annual GDP of the Caribbean and Central America combined. Since the mid-1990s I have thought that derivatives would be the force shaping global finance. I never imagined that such a helpful tool could be so abused.
Great attention getter...
Steve Forbes got it right (again!) when he called for the idiots (my term, not his) running these banks to quit jumping the gun on write-downs!
Until the actual default, IF THEY EVER REALLY DEFAULT, you cannot guess the real dollar impact. All you can do is help the mass media yell "fire" in a crowded economy.
There is no recession.
-ski
Posted by: Jeff SKI Kinsey | April 25, 2008 at 09:32 PM