Not by you, but the implication is being made in the medja. i.e. "It's all ok now, the selloff was all caused by somefrog in a cubicle in the mail room of some unpronounceable French bank. Come back in, the water's fine."
said the simmering pot to the lobster..
I'm in a negatively stirring mood today...
Carrying on with his well worn cry US Paulson has urged the US senate to
quickly approve the $150bln stimulus package.
Reuter"s reports that in a television interview Paulson said the plan was carefully crafted to be
temporary and should be kept simple to
get the money out as fast as possible. The urgency of the stimulus plan underlines the
dodgy nature of the US economy and coincides with the IMF at the Davos shindig that a "serious" response was required to counter the risk of a US recession and slowing world growth, and as a former Treasury Secretary points out, this is the first time in a quarter of a century that the IMF has called for an increase in budget deficits....traditionally its all been about fiscal consolidation.
This is hardly a great environment to be long stocks or anything else that follows the markets, which is most everything that re-acts to, correlates with, or has risk aversion possibilities built in.
Barclay"s Capital have just released estimates showing that if the American monoline insurance companies have their credit ratings downgraded across the board the world"s banks could wind up needing to
raise as much as USD 143bn . Barclay"s reckons that about 75% of the USD 820bn in financial products with monoline guaranties are held by banks across the globe (which banks??
) . If the products carrying monoline guaranties are lowered by one rank from the top AAA rating, the banks would need to raise USD 22bn, while a downgrading to single A would necessitate six times more capital.
Cheers
............Kauri