Bank Losses: Half Trillion and Counting
Remember the good old days? Ahhh, a simpler time, when we were repeatedly told that sub-prime didn't matter, that it was contained, that the losses were a mere $60 billion dollars at most, and overall, this would have zero impact on the broader economy?
Only not so much.
We learned via the number crunchers at Bloomberg that the $500 Billion mark in losses and write downs has now been crossed:
"Banks' losses from the U.S. subprime crisis and the ensuing credit crunch crossed the $500 billion mark as writedowns spread to more asset types.
The writedowns and credit losses at more than 100 of the world's biggest banks and securities firms rose after UBS AG reported second-quarter earnings today, which included $6 billion of charges on subprime-related assets.
The International Monetary Fund in an April report estimated banks' losses at $510 billion, about half its forecast of $1 trillion for all companies. Predictions have crept up since then, with New York University economist Nouriel Roubini predicting losses to reach $2 trillion."
That may sound bad -- but it looks even worse:
All charts via Jake at Econompic Data
$500B is about 10X the original contained estimates of meaningless losses . . .
Banks' Subprime Losses Top $500 Billion on Writedowns
Bloomberg, Aug. 12 2008
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In keeping with the Paul Perspective, it should only matter 10th as much as it should have been ignored! Uncle Sam wants you to buy War Bon.... ummm Equities!
Posted by: Rob P. | Aug 13, 2008 7:39:54 AM
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