Friday, September 16, 2011

Biggest Brokest Banks

Biggest banks by assets for the business year of 2010 in CHF billion:

Broken banks according to the market as of the close of 2011-09-15 by percentage of market capitalization in relation to their assets (aeh, basically liabilities;-):

Data source: Thomson Reuters Datastream

Thursday, September 15, 2011

Soros on Europe

From Zero Hedge: Soros Thinks The Unthinkable About Europe
All this would cost money. Under existing arrangements no more money is to be found and no new arrangements are allowed by the German Constitutional Court decision without the authorization of the Bundestag.

[Any solution] would presuppose a radical change of heart, particularly in Germany. The German public still thinks that it has a choice about whether to support the euro or to abandon it. That is a mistake. The euro exists and the assets and liabilities of the financial system are so intermingled on the basis of a common currency that a breakdown of the euro would cause a meltdown beyond the capacity of the authorities to contain. The longer it takes for the German public to realize this, the heavier the price they and the rest of the world will have to pay.
With a comment from jeff montanye:
sacrifice democracy and freedom because disentangling euro based accounting is too complex? aww, go on, give it a try. and remember: the bondholders, stockholders and current management are the first to make a sacrifice, not the last. see how far that gets you.

Der Spiegel Interview with George Soros
SPIEGEL: Is the current crisis even worse than the one in 2008?

Soros: This crisis is still the continuation of the same crisis. In 2008, the financial system collapsed and it had to be put on artificial life support. The authorities managed to save the system. But the imbalances that caused the crisis have not been removed.


Soros: Of course, speculation will always make a crisis worse. If there is a weak point, it will expose it. And you are right, the CDS market is a very dangerous instrument and I think it should not be allowed. I am one of the very few people who argue that the CDS is a dangerous instrument because it is so lop-sided in favor of a negative outcome.


Soros: The indebtedness of the US is not all that high, but if a double-dip recession was in doubt a few weeks ago, it is less in doubt now, because financial markets have a very safe way of predicting the future. They cause it. And the markets have decided that America is going to see a recession, particularly after the recent downgrade of the US by the rating agency Standard & Poor’s.

SPIEGEL: President Barack Obama has been fiercely criticized for his handling of the economy. You were one of his biggest supporters in 2008. Are you happy with his economic policy?

Soros: No, of course not. But the reality is that we have had 25 years of excesses building up in America — a combustible mix of too much credit and too much leverage. You need a long time to reverse that.


SPIEGEL: The $800 billion stimulus program launched by Obama did not live up to that?

Soros: Obama’s stimulus program was not big enough and it was not directed at improving infrastructure nor human capital. So it was not productive enough.

SPIEGEL: And any further stimulus is now basically a non-starter, because the conservative majority in Congress is hell-bent on preventing it.

Soros: That is what is pushing the world towards another recession, into a double dip.


SPIEGEL: As an investor, do you listen to the rating agencies?

Soros: Well, I do not, but many other investors do.


SPIEGEL: In the end, will China be the only winner in this crisis?

Soros: China, of course, has been the great winner of globalization, and if globalization collapses, the Chinese will also be among the losers. So they have a strong interest in preserving the current global system. However, in some ways, they have been just as reluctant to accept it as the Germans. Germans have been hesitant to accept responsibility for Europe, and the Chinese have been hesitant to accept responsibility for the world. But they are both being pushed into it.

Thursday, September 01, 2011

Busting Banks

busting banks
Bank price sales multiples for 2011-08-31, market cap and sales in CHF billion.

Data source: Thomson Reuters Datastream