Comments on: Too big to rescue

By: New Citigroup maven Buiter warns of sovereign debt delusion - Credit Writedowns

New Citigroup maven Buiter warns of sovereign debt delusion - Credit Writedowns — Fri, 12 Feb 2010 15:14:31 +0000

[...] to bankrupt troubled institutions. This is what he terms the sovereign debt delusion (see “Too big to rescue” for more on this).His most recent blog entry pointed out the relative insignificance of Dubai in [...]

By: UBS is too big for Switzerland - VicktorCapitalist

UBS is too big for Switzerland - VicktorCapitalist — Thu, 16 Apr 2009 15:54:14 +0000

[...] released this week. I have been saying for quite some time that UBS is too big to fail, but also too big to bail for tiny Switzerland. In my view, the recent financial results demonstrate that, although this [...]

By: dan

dan — Tue, 17 Feb 2009 00:56:40 +0000

Online ad hereCan’t find a link to the TV commercial accompanying the campaign

By: Edward Harrison

Edward Harrison — Tue, 17 Feb 2009 00:43:10 +0000

@dan,
thanks for the info. that’s a pretty hefty return. Please link to an ad if you can.

@econophile,
If GM goes bankrupt or BAC fails, it cold set up another crisis of confidence like we saw with the GSEs and Lehman. Whatever happens, it must be an orderly process or we risk a very bad outcome. (And thanks for your comments on the re-design). It was very necessary).

By: dan

dan — Mon, 16 Feb 2009 22:01:41 +0000

Speaking of HSBC they just started a new ad for CD’s at 5X the going rate.

By: Econophile

Econophile — Mon, 16 Feb 2009 20:26:10 +0000

Edward, what would happen if some of these banks failed? Let’s say GM goes b/k. Let’s say BAC fails. Why would the world collapse?

PS I like you redesigned site.

By: Edward Harrison

Edward Harrison — Mon, 16 Feb 2009 15:55:04 +0000

You are right. The Swiss figure is the PPP version. I will correct this later today.

By: Holzbein

Holzbein — Mon, 16 Feb 2009 15:49:30 +0000

Excellent post… Edward!

But I think you have mixed up BNP figures for Switzerland between Purchasing Power Parity BNP and Nominal BNP.

Swiss Nominal BNP US$ 426,7 Bln (2007). So the ratio CS Asset/ Swiss BNP will be 703%.
(Source: The Economist Country Section)

Anyway, still very frightening.

By: sobers

sobers — Sun, 15 Feb 2009 23:33:21 +0000

I had heard that the European banks were in deep trouble, but I didn’t know it was this bad. These figures are staggering. This is an disaster waiting to happen. I can see only one outcome. Something will precipitate an initial collapse, and then the whole pack of cards will fall. I foresee bank doors being closed. You won’t be able to get your money. It’ll be there on paper, but you won’t be able to access it. Cash machines won’t work, or will only give you a very limited amount of cash. Govt will step in and may even invoke National Emergency type legislation.

I recommend taking some steps to ensure you have access to cash/wealth in case of such an eventuality. I already have, and sleep sounder at night as a result.