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Strategies & Market Trends : The coming US dollar crisis

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To: dybdahl who wrote (2526)11/22/2007 9:08:45 PM
From: RockyBalboa  Read Replies (2) of 71479
 
Not 100B. Given the usual share of equity (7%) the reported discounts of 3 to 5% put the equity portion under stress. Even large banks can not easily sustain repeated exercises in debt turning sour and staying on book or placed at a loss.

In any case banks hate that deals trade at a 5% discount because those transactions, once made public put the valuation of existing books under stress too. No auditor can afford to turn a blind eye. Those losses are no longer temporary.

You see that various collateralised debt is a tough sale and unfinished inventory from financial aquisitions adds to the problem.
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