Credit Crisis Over? Not Likely
In contrast to the CEO Parrot's here; Jon Markman at MSN concurs with the ex Fed head and the Nattering One, in Credit Crisis Over? Not Likely...
Short-term rallies and wishful thinking have buyers ready to pounce, but the end of the credit mess isn't yet here.
Satyajit Das, an independent debt derivatives expert leapt at the chance to scoff at U.S. bank presidents' vows that the worst of the credit crisis is over.
Paraphrasing Winston Churchill, in a voice dripping with Aussie irony, he quipped,
"This is not the end or even the beginning of the end, though it may be the end of the beginning.
Given that the bank presidents have been consistently wrong about everything they've said about their losses until now, why on earth would anyone believe them now."
Das calculates that the $200 billion raised from outside sources so far is just a down payment
and that banks have up to $700 billion more to go -- an amount far in excess of their total earnings over the past half-decade.
And Das wishes to remind investors of the $1 trillion to $3 trillion that's still in the process of...
moving onto the banks' balance sheets from related entities where they were hidden in SIV's.
The borrowed money that previously bulled stocks toward last year's high is gone,
and so is the earnings-growth confidence that's necessary to push price-earnings multiples higher.
Short-term rallies and wishful thinking have buyers ready to pounce, but the end of the credit mess isn't yet here.
Satyajit Das, an independent debt derivatives expert leapt at the chance to scoff at U.S. bank presidents' vows that the worst of the credit crisis is over.
Paraphrasing Winston Churchill, in a voice dripping with Aussie irony, he quipped,
"This is not the end or even the beginning of the end, though it may be the end of the beginning.
Given that the bank presidents have been consistently wrong about everything they've said about their losses until now, why on earth would anyone believe them now."
Das calculates that the $200 billion raised from outside sources so far is just a down payment
and that banks have up to $700 billion more to go -- an amount far in excess of their total earnings over the past half-decade.
And Das wishes to remind investors of the $1 trillion to $3 trillion that's still in the process of...
moving onto the banks' balance sheets from related entities where they were hidden in SIV's.
The borrowed money that previously bulled stocks toward last year's high is gone,
and so is the earnings-growth confidence that's necessary to push price-earnings multiples higher.
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