Friday, February 17, 2012

Treasures from the threads - Number 72 - Mad Mervyn King

I have chosen the following comment which was in response to a sub-posting on Acting Man, linked here, titled:
"Uncle Mervyn, the Lunatic Running the UK Funny Money Farm"

I wonder about the timing of these bank downgrades, there are a lot of rumors swirling now that Greece will indeed default within the next month or so….
I kind of expect that a default in this case will be telegraphed because unlike the crash where the bankers were keeping there cards close to their vests and there was a lot of opacity in this case a LOT of people are in on the negotiations so its bound to leak out if a decision is made…..and of course a default will be a decision.
So seeing Moodys waving the downgrade stick recently and now hearing these rumors, I wonder if something is indeed imminent.
Then you have to wonder what happens with CDS?
JPM and BOA moved a trillion or so in derivatives into the FDIC portion of the bank awhile back to “allay the fears of European counter parties” was the quote I recall saw….are depositors funds at these two rat holes now vaporizable as MF Globals customer funds proved out to be?
What a mess!

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