Who says that Europeans don’t get Halloween? After more than a year in the making, the European Central Bank (“ECB”) just finished its most recent stress test and found that pretty much everything was kinda OK. Sure, a few banks here and there in the nether regions flunked, but perhaps with the exception of that most wonderful Banca Monte dei Paschi di Siena, no one flunked that badly.
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The Grand Illusion: A Strategy
By Rick Jones on
Have you heard the following thought expressed recently in one way or the another, “I’m less worried about what new black swans might swim onto our screens and more worried that we will just wake up one day, peer out of our bunker of habituated indifferences to the drumbeat of troubling news and decide, suddenly, that things actually are terrible!” Bad news seems to pile upon bad news in the larger world. We are off the map of the known universe in terms of monetary and fiscal norms, and yet when the last worse headline comes across the ticker, and the newsreaders do their level best to create drama, the debt and equity markets seem to, well, yawn. What happens if one day we wake up and all of a sudden all that which was benign yesterday is terrible today? It’s like one of those sci-fi movies where the doughy earthlings encounter a race of beautiful, peaceful people and then, in a blink, see them as the multi-arm, walking crustaceans with eyes on stalks and a distinct preference for space hero tapas that they really are.
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A Mid-Year Report Card on the Commercial Real Estate Capital Markets
By Rick Jones on
We at Crunched Credit have taken a bit of a pause of late. It is, of course, the dog days of summer. But it’s time to get back into the fray. Let’s start by noting the doldrums seem to have taken a pass. From where we sit, the markets seem to be in robust health. As we look over this complex web of transactions, deal structures, innovations, capital flows, business plans, business goals, failures and successes that is our market, things look pretty damn good.
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EU Banks –Dog Bites Man, Again
By Rick Jones on
The Financial Times reported on April 2 that the Eurozone Banks continue to load up on sovereign debt; generally, the debt of their respective host countries. A few days later, the Financial Times reported a bevy of talking heads crowing over the end of the EC financial crisis. And then on April 16, the European Parliament voted to approve a slew of new laws for the EU banking marketplace, including a single resolution mechanism so comprised to be almost useless and a common rulebook for winding down the banks. Does anyone here or there think any of this really matters? First, it’s going to take years to generate the rules that this legislation birthed and even after the Euro apparatchiki spend years creating detailed rules, the dynamics of Brussels will ensure there will be so many loopholes it would make a block of Swiss cheese blush. Moreover, does anyone actually think the various nation states will honor these rules if a champion bank is in trouble? I, for one, do not.
Continue Reading EU Banks –Dog Bites Man, Again