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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: Robin Plunder who wrote (99544)	11/9/2008 5:23:52 PM
From: Hawkmoon	Read Replies (1) of 110194

any regulator can be bought, as witness the recent wave of deregulation which allowed investment banks to increase leverage. Well, I don't disagree with you there.. But there's more to the picture if we stop being so myopic. Ever wonder why the financial crisis in Europe seems to be so much more severe than in the US? Look at the leverage that many of these European banks operated under: conquerthewallstreet.blogspot.com And pay special attention to Barclays, UBS, and Deutsche Bank!! Deutsche Bank's liabilities, alone, equate to 80% of Germany's GDP. And the whole situation is compounded by the fact that the ECB is really a confederation of each of Europe's separate central banks, each with its own parochial interests and finger pointing at one another. This was one of the primary reasons the SEC permitted our 5 investment banks to increase their leverage to 40-1. They just couldn't compete with the European banks. And AIG, as counter-party to many of the European banks in these inane CDS transactions, facilitated this excessive leverage. Thus, did we bail out AIG to save the US financial system, or the European?? Hawk

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