More write-downs?
Written by A Forex View From Afar on Thursday, February 28, 2008Back to www.thelfb.com
This is what I've said on 14 February
"(...)who could say in front of the whole Nation that inflation is rocking, consumer are not spending, nor are they saving, they pay mortgages to banks who are just preparing for another wave of write downs, and the financial crises was totally contained? The economy is in a mess, most of the public seem fully aware of that."
Well, we found out who could say all those things in front of the whole Nations, it was Mr B. testifying under the Senate Committee.
Today we found a person who supports the claim about further write-downs on banks, Josef Ackermann the Deutsche Bank AG Chief Executive Officer.
Being an insider, I'm pretty sure we can take its word as granted. DB has avoided, so far, sub-prime related losses by hedging earlier on.
While Mr. B was saying the worse, and Mr Ackermann was confirming our thoughts, Royal Bank of Scotland revealed another 450£ mil (980$ mil) losses coming from miscalculated risk on sub-prime. This is what ahead of the Curve really is...predicting 2 weeks earlier.
Financial sources have revealed an eventual bail-out plan organize by the government to save US home-owners will costs the Government between 200-250bn $. Adding up the cost of the current rate cuts (which will be seen over time) and the cost of the Financial Stimulus Package end up to fortune spend because of some reckless banks.
Source:
Bloomberg: Ackermann Forecasts More Writedowns at World's Banks
FT: RBS reveals further £450m losses from turmoil
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