Home > Man-Made Disasters > Chief Economist Believes Europe Could Just Have Days Before A Financial Catastrophe, Moody’s Downgrades 10 German Banks, Fitch Warns US Banks

Chief Economist Believes Europe Could Just Have Days Before A Financial Catastrophe, Moody’s Downgrades 10 German Banks, Fitch Warns US Banks

11/17/2011 Leave a comment Go to comments

By Joe Weisenthal – “This is a fantastic interview with Citi’s Willem Buiter on Bloomberg TV.

You can hear the anger in his voice as he argues that Europe may have a matter of days before an unnecessary default and a financial catastrophe.

The answer: the ECB must act fast, and ignore the Germans who don’t get it. While some people don’t think that the ECB can really monetize sovereign debt this way, Buiter believes there’s absolutely nothing preventing the ECB from doing whatever it wants on the secondary market…

Buiter on Europe’s crisis:

‘Time is running out fast. I think we have maybe a few months — it could be weeks, it could be days — before there is a material risk of a fundamentally unnecessary default by a country like Spain or Italy which would be a financial catastrophe dragging the European banking system and North America with it. So they have to act now.’

‘The only two guns in town, one is only theoretical, and that is increasing the size of the EFSF to 3 trillion. It should happen but it can’t for political reasons. The other one, the only remaining share is the ECB. They may have to hold their noses while they do it, and if they don’t do it, it’s the end of the euro zone.'” Read more.

Moody’s downgrades 10 German public banks – “Moody’s downgraded on Wednesday its ratings of 10 German public-sector banks including BayernLB and Deutsche Hypo saying they were now less likely to receive state support if needed. ‘The rating actions reflect Moody’s assumption that there is now a lower likelihood that these banks would receive external support, if required,’ it said. It noted that EU rules restricted support and that Germany had set up a bank resolution scheme.” Read more.

Ratings agency Fitch issues warning for U.S. banks – “Fitch Ratings warned that it may reduce its “stable” rating outlook for U.S. banks with large capital markets businesses because of contagion from problems in troubled European markets. ‘Unless the euro zone debt crisis is resolved in a timely and orderly manner, the broad outlook for U.S. banks will darken,’ Fitch said. ‘The risks of a negative shock are rising.’ The warning was aimed at the entire U.S. banking sector …” Read more.

Categories: Man-Made Disasters
  1. Unknown's avatar
    Anonymous
    11/17/2011 at 2:36 PM
    Reply

    To be expected I suppose that the bankers are now pointing fingers at each other. They are the ones who took us over the edge because of their greed and their corrupt agendas. Strange how profits and bonuses are a private business issue but defaults and bank failures a public one funded by the tax payers. I think James hit the nail on the head so to speak timeline wise below in verse 3.

    Ps 39:6 Man is a mere phantom as he goes to and fro: He bustles about, but only in vain; he heaps up wealth, not knowing who will get it ………….Ps 39:11 You rebuke and discipline men for their sin; you consume their wealth like a moth each man is but a breath

    Jer 22:13 “Woe to him who builds his palace by unrighteousness, his upper rooms by injustice, making his countrymen work for nothing, not paying them for their labor.

    Jas 5:1 Now listen, l you rich people, weep and wail because of the misery that is coming upon you.
    Jas 5:2 Your wealth has rotted, and moths have eaten your clothes.
    Jas 5:3 Your gold and silver are corroded. Their corrosion will testify against you and eat your flesh like fire. You have hoarded wealth in the last days…………….
    Jas 5:5 You have lived on earth in luxury and self-indulgence. You have fattened yourselves in the day of slaughter

    Wn

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  2. Kurt J.'s avatar
    Kurt J.
    11/17/2011 at 3:18 PM
    Reply

    ICA, can you add a “current price of gold” widget to the right hand column, near the oil price?

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