Basel’s Diluted Liquidity Rule Compounds Capital Failure

This weekend banks got a big win from Basel, easing liquidity requirements more than expected. Banks surged after screen shot 2013-01-07 at 4.33.27 amunexpected win over the weekend.

How memories fade. Five years ago the UK had witnessed the first run on a bank – Northern Rock – since 1866 while the panic that followed a year later when Lehman Brothers collapsed led to £65bn of taxpayer money being poured into Royal Bank of Scotland, Lloyds and HBOS.

Indeed in 2010 Lord Turner, chairman of the Continue reading “Basel’s Diluted Liquidity Rule Compounds Capital Failure”

2012 Mid Year World economy towards the path of Bailouts & Bankruptcies

Well its the last day of the month and the world economy standing in the mid of year 2012. Lets try to pull the events by connecting the dots and see where the world is :
1) After months weeks years of posturing and denial Spain and Cyprus formally requested aid from Europe bailout funds. More so they have officially confessed to their insolvency and the insolvency of their banking system.
Spain 10 year bond yield breached the worst level and it touched the 7% in return many od the Spain bank ratings got junk by Moodys

2) Over in the US, the city of Stockton, California filed for bankruptcy this week… Continue reading “2012 Mid Year World economy towards the path of Bailouts & Bankruptcies”

Hello World Bank for International Settlements Warns

Yesterday I was going through a very interesting piece delivered by Jaime Caruana . General manager of the Bank for International Settlements (BIS) and he also hold the position in the past to be a former governor of Bank of Spain.

Well the message from the report of BIS is very clear that not enough being done to repair finances of Banks & Governments – cheap central-bank money props up the lame ducks. Another major remark from BIS Continue reading “Hello World Bank for International Settlements Warns”