Pop quiz!

Okay, kids, since WaMu just failed this evening (formerly worth 307 billion dollars), I thought it was time for a bit of a brief, educational trivia quiz so here goes:

1) What was the last, biggest bank failure, before WaMu's today/tonight?

Answer: Continental Illinois (remember that one?) in 1984 (yeah, that long ago).

2) How much were they worth?

Answer: 40 billion dollars.



kinda puts the current situation in perspective, don't it?

If you're not somewhat concerned yet, stay tuned.

Are we done yet?

Could we now, once and for all, put to rest the ridiculous, short-sighted and irresponsible idea that the banking industry in the United States doesn't have to be regulated by government?

Please?

That same deregulation of banking in the US allowed for the huge scale of unsupportable, irresponsible loans to people who should never have had them and couldn't afford them in the first place. While it got these institutions absurd, large and, again, unsupportable short-term benefits and false profits, it has brought about the largest collapse of the international banking system since the Great Depression. This is no longer debatable.

The government, while we do want it small, efficient and responsible, is extremely important for its role as watchdog, particularly against corruption within corporations and multinational corporations.

We are now paying the price for not having scrutinized our banking sector. Indeed, the world is paying this price, really, due to the collapse in confidence of the credit markets.

Can we agree that government has its role in the world and move on?

What I've been saying

Pimco: U.S. bank system capital insufficient

Fri Sep 12, 2008 5:38pm EDT
By Jennifer Ablan

NEW YORK (Reuters) - Mohamed El-Erian, the chief executive of top bond fund Pimco, said on Friday that the U.S. banking system doesn't have enough money to weather the current credit crunch related to massive mortgage-related losses.

Complete article here: http://www.reuters.com/article/ousiv/idUSN1244742820080912
_________________________________________________________

This is what I've been saying.

When you consider the takeover of both Fannie Mae and Freedie Mac, add in the 11 banks that have already failed this year (that one last week, remember, in Nevada, is expected to cost 500 million dollars alone), Bear Stearns, Lehman Brothers next and then the other 116 banks that are on the FDIC's list of "troubled" banks, folks, we ain't got enough money.

That's right.

The United States of America doesn't have enough money, ladies and gentlemen.

Hang on to your seats.

Oh, and the driver of the bus is asleep at the wheel.

But don't panic.

(P.S. Merrill Lynch is crumbling now, too.)

I'm Voting Republican!

See more funny videos at Funny or Die

USA Bank: The next one to close?

USA Bank Reports Operating Results for the Quarter Ended June 30, 2008
Saturday August 9, 11:34 am ET

PORT CHESTER, NY--(MARKET WIRE)--Aug 9, 2008 -- USA Bank (OTC BB:USBK.OB - News) reported a net loss of $383 thousand ($0.07 per share) for the quarter ended June 30, 2008, which is a marked improvement compared to the net loss of $481 thousand ($0.08 per share) for the quarter ended June 30, 2007. This marks the third successive quarter of reduced losses by the Bank. For the six months ended June 30, 2008, the Bank's net loss was $1,129,000 ($0.20 per share) as compared to a net loss of $1,995,000 ($0.35 per share) for the six months ended June 30, 2007.

Complete, orginal story here:
http://biz.yahoo.com/iw/080809/0423542.html

Stay tuned.

A big Friday

So oil is down to $115.00/barrel today, the Dow is up, the dollar is up against the Euro and the British Pound--since they didn't raise their interest rates--and the Olympics starts today in Japan.

A big news day, to be sure.

The question for the banks--and the American people--is, will we witness and have to finance another bank failure in the next 24 hours? Will the FDIC have to march into yet another bank this evening and close it up because it's "upside down", financially.

Hopefully not, certainly.

If they don't have to, it would be nice to break the 3-week straight we've had on these things.

Hopefully it's a quiet, uneventful evening and weekend.

Enjoy, y'all.

A weekly Friday night occurrence?

Okay, campers, last week it was the big Indymac implosion on a Friday evening.

Were you ready for this week's? No, I thought not.

This week, they weren't as big, by themselves, as Indymac, but there were 2--count 'em, 2--banks that "went down": First National Bank of Nevada and First Heritage Bank of Newport Beach (both were units of the First National Bank Holding Company, based in Scottsdale, Ariz.).

So the thing is, were you paying attention? Did you even notice this happened? They do these on Friday evenings so people won't notice and panics don't set in, of course, just like political announcements out of Washington, when they're negative. Mind you, this is big news, right? But try finding mention of it now, on your regular search engine. Pull up Yahoo! and see if it's listed there, on the first page.

It's not.

The thing is, there's more to come, apparently. Certainly we all hope not but information seems to lean otherwise. I searched yesterday on the internet and, from what I read, the FDIC was watching 90 banking institutions, that may be on less than solid ground.

So for the foreseeable future, you might want to watch for those Friday night announcements. It's like I keep saying, pay attention.

Oh, and if one or more starts happening mid-week, and they can't contain the collapse of this or that financial institution(s)? It means things have really gone to heck--either for that one institution or, God forbid, for the banking sector in general, and in a much larger scope.

Here's hoping there aren't too many more weeks of this stuff.