(A) US Bank 'To Fail Within Months'

[NashVegas]

Source: BBC

The global financial crisis is set to get worse, with a large US bank likely to collapse in the next few months, a former IMF chief economist has warned.

Kenneth Rogoff's comments came as shares in Fannie Mae and Freddie Mac sank on a report that the home lenders would, in effect, be nationalised.

Despite hopes that the US economy had turned the corner, Mr Rogoff claimed it was "not out of the woods".

...

Speaking at a conference in Singapore, Mr Rogoff, now an economics professor at Harvard, forecast that Fannie Mae and Freddie Mac would "probably" not exist in their present form in a few years.

"We have to see more consolidation in the financial sector before this is over."

Read more: http://news.bbc.co.uk/2/hi/business/7569903.stm

---

I bolded the particular line because it goes exactly the opposite way one would expect. Besides all the mortgage speculation, it's consolidation which has largely caused the current disaster, as business entities have to take out bigger and bigger loans to buy each other out.

These people are fucking nuts in their little power quest.


Mods - the given headline was a little confusing to people. I modified it to better reflect the content (A United States bank, not US Bank).

[bananas]

1. Which one? Which one? Tell us! Please!

[tekisui]

2. Which one, I wonder?

[Sanity Claws]

3. I agree -- we should be going smaller

The reasoning has been that these banks are too large for us to allow them to fail. Making them bigger sounds incredibly stupid.

[tekisui]

5. More local, credit unions and smaller banks.

Really, this is a solution for most of our problems.

Go LOCAL!

[bigworld]

Wachovia.

[tekisui]

6. I have to go make a withdrawal.......

[Blue_Tires]

20. that's my guess, too

[Joe Bacon]

4. Rogoff is a big McW supporter.

Must be nice to be McW's jockstrap :puke:

[ixion]

7. consolidation? hmmmm... that is suspicious

I agree with you. Consolidation is what caused much of this, so I can't see why more of it would be a good thing. Now, from the uber-wealthy perspective, it would make sense to try and de-value something before acquiring it.

And thus we see a glimpse of what is going on behind the curtain, as it were.

[NashVegas]

13. From the Power-Elite's POV

The less people controlling the money flow, the easier it is to chart your strategy.

[elfin]

8. I switched from US Bank to a smaller one two years ago

mainly due to their terrible interest rates on savings and CDs.

It's a pain to switch banks, tracking down all the accounts you have for automatic deposits and withdrawals, but I have been much happier.

With FDIC, didn't have enough in there to worry about losing my stash, but still glad I did it.

[elfin]

9. Just re-read your post - at seems to be "A" US Bank - not "the" US Bank nt

[NashVegas]

11. Correct

[daggahead]

10. And yet ...

In my area, there seems to be a boom in building new banks.

[NashVegas]

12. Yeah, Some of That Near Me

There's at least one new, local, bank with some major players.

[Eurobabe]

14. what's that site again bankimplode.com??

Look at these numbers, I say Citibank for $400 Alex.

# JP Morgan Chase - $19.5B
# Morgan Stanley - $24.0 B
# Bank of America - $51.3B
# Lehman Brothers - $55.2B
# Wachovia - $50.5B
# UBS - $92.5B
# Royal Bank of Scotland -$41.7B
# Citigroup - $144.5B
# BNP Paribas SA - $3.3B
# Commerzbank - $1.06B
# Societe Generale - $30.1B
# HSBC Bank PLC - $27.7B
# Credit Suisse - $94.5 B
# Deutsche Bank - $155.1B
# HBOS PLC - $19.0 B
# Merrill Lynch - >$83.5 B
# Washington Mutual - $28.6B
# National City - $14.9B
# Fifth Third Bancorp - $3.6 B
# SunTrust - $2.0B

[Yavin4]

24. Citigroup Is My Pick As Well

Standing on shaky ground.

[L0oniX]

27. I actually hope that it is Citigroup. They never stop sending out CC apps.

[Indenturedebtor]

15. I wonder if I should just mail a check to this bank myself

After all if I stay in this country it will be me and my children who will pay for their bailout. If I'm lucky I might even get to pay them overlimit fees at some glorious day in the future.

We joined a credit union over the weekend. We're going bankrupt right now, and wanted to get in before our credit went to shit heh. Just made it ;)

[missTheBigDog]

16. I'm pretty sure it's....

WaMu! They have been in trouble for quite some time!

[Gormy Cuss]

25. WaMu would be my first guess too. n/t

[whistle]

17. Fannie Mae and Freddie Mac are being used by the big investment banks

...to bail them out of high risk investment loans they gambled on during the last seven years saddling the debt on the Federal Government and tax payers

[The2ndWheel]

18. Why would consolidation be the opposite of what's expected?

If the global economy is going to stick around, consolidation is the only way to keep it going. Look at healthcare, everyone wants single payer. That's consolidation. Nationalizing oil. That's consolidation. The EU is consolidation. Keeping the 50 states that make up America united is consolidation.

Breaking down into smaller entities is the opposite of what I would expect. That goes against thousands of years of history and momentum.

[robcon]

19. It's consolidation like Bear Stearns was "consolidated" into JP Morgan.

A fire sale of a failed bank.

[NashVegas]

23. Well, If You Wanted to Fix the Problem, That Is

As we've seen time and time again, over-consolidation leads to top-heavy companies that are ill-prepared to deal with unexpected disruptions of the marketplace.

For the ultimate consolidation the IMFers & WTOers are looking for, the only way to keep a stabilized model would be through totalitarianism. Those tend not to work out so well for most people in the short run and for the controllers, in the long run they lose out to entropy anyway.

[Dover]

21. "not out of the woods"???? Sounds more like the Forest Of No Returns!

Despite hopes that the US economy had turned the corner, Mr Rogoff claimed it was "not out of the woods".

"I would even go further to say 'the worst is to come'," he said.

"We're not just going to see mid-sized banks go under in the next few months," said Mr Rogoff, who held the IMF role between 2001 and 2004.

"We're going to see a whopper, we're going to see a big one, one of the big investment banks or big banks."

We have to see more consolidation in the financial sector before this is over.


Which means some are going to break up into pieces and others will collect those pieces...cheap.

[Junkdrawer]

22. I bet it's National City...

I have my checking, savings and mortgage with National City.

I started with Equibank...

It was sold to Integra....

Which was sold to National City...

Wonder who I'll be with next. :shrug:

[Dover]

26. Something I saved from a blog discussion back in March about Citi

I don't think the Fed is trying to move the market any more. It's trying desperately to keep the lid on through the panic. The Times reported last week that the increase in TAF was to prevent the collapse of "a major bank." Not hard to guess which one. Early Friday, Schwab was offering Citigroup notes due April 09 at a price which would yield just under 9.9% to maturity (13 months away!). They apparently had no takers. By the end of the trading day they were offering the same security to yield 10.11%. There's massive doubt out there as to whether Citigroup will still be there in April 09 to pay off its notes. We have never had a bank the size of Citibank fail. Hell, until recently we never had a bank the size of Citibank. Such a bank failure would be game changing. One can interpret everything Bernanke's done simply as trying to prevent it. Apply Occam's razor.

[Blackhatjack]

28. WaMu is desperate to raise $$$ .... I get 2-3 offers in the mail each week...

Most are 0% for a year or more.

Then I read the fine print disclosure form and discover the onerous terms if they decide unilaterally to raise the interest rate for any reason.

There have been recent posts on these boards about WaMu doing just that, in some cases raising the interest rate 9% or more "for no reason at all" the customer service rep could identify.

[donheld]

29. Tacky headline could cause a run on