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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: Mark Adams who wrote (5366)	6/29/2001 6:50:09 AM
From: Earlie	Read Replies (2) \| Respond to of 74559

Mark: I see someone else provided an appropriate comment on your note. Bankers have many ways to mask their problems. Credit card default rates are climbing. Several actions by the banks make the messy scene look better than it is. As an example, the rate at which the banks are writing off credit card debt is rising quickly (which of course makes the ratios relating to the credit card debt still on the books look better). The reason why the banks do not want the public to be concerned about the rising credit card default rate is that a great deal of credit card debt is securitized and sold to the public. Already, the banks have been forced to "make good" on a few securitized default packages that blew up (an insane thing to have done, as it has set a dangerous precedent). This represent just one more in a long list of "off-balance-sheet" liabilities that will pop to the surface at the wrong time as this spiral tightens. Best, Earlie