Tom Spencer

NOVEMBER 25, 2011

Thirdly, European banks are currently focused on building their balance sheets not on lending. European banks have until the end of June 2012 to get their core capital ratios up to 9%. While Bunds may still smell sweet, weak financial markets in Europe are a cause for concern. How could Dexia fail?

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Balance Sheet Banking Financial Case Interview 89

MishTalk

AUGUST 8, 2013

In Fed Balance Sheet vs. Stock Market; Will QE Cause Inflation? I posted an interesting chart by reader Tim Wallace of the stock market vs. Fed asset holding (repeated below for convenience). Fed Balance Sheet vs. Stock Market. What about foreign central bank assets, especially China and Japan?

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Balance Sheet Banking Marketing Report 64

MishTalk

SEPTEMBER 8, 2014

Banks are in the business of making loans. Exploring Lending Club Bloomberg columnist Mat Levine explores the issue in Lending Club Can Be a Better Bank Than the Banks. There are a lot of ways in which [Lending Club] is not a bank, but the big one is that basically all (95.6 Is that the right model?

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Banking Balance Sheet Financial Operations 61

Tom Spencer

MAY 2, 2020

Since the start of February this year, the Fed has expanded its balance sheet by more than $2.4 To put that in context, the Fed was created in 1913, and its total balance sheet assets only reached $2.4 trillion in assets, but only 2 months to achieve the same amount of balance sheet expansion this year.

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Balance Sheet Government System Finance 88

MishTalk

SEPTEMBER 30, 2014

On September 4, ECB President pulled out a financial bazooka including a pledge to build up the ECB''s balance sheet by another €1 trillion. Mario Draghi is to push the European Central Bank to buy bundles of Greek and Cypriot bank loans with “junk” ratings, in a move that is set to exacerbate tensions between Germany and the bank.

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Balance Sheet Real Estate Banking Policies 64

MishTalk

OCTOBER 6, 2015

Reader Gary emailed a link to JP Morgan's Quarterly Market Guide. Central Bank Policy Rates Current Rates Bank of England: 0.50% Bank of Japan: 0.10% Fed: 0.00%-0.25% (currently 0.14%) ECB: 0.05% Central Bank Balance Sheets Three Questions Other than asset bubbles, what do we have to show for this?

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Balance Sheet Banking Policies Marketing 28

MishTalk

DECEMBER 18, 2013

The Financial Times notes a Big rise in subordinated debt issuance by EU banks Banks have taken advantage of yield-chasing investors to issue $90.7bn of subordinated debt for the year to date, a 41 per cent increase compared to the same period in 2012. It relates to bail-in procedures in the alleged European "banking union".

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Banking Balance Sheet Finance Government 56

MishTalk

SEPTEMBER 4, 2014

Banks create money when they lend. I’d start a charity whereby every newly appointed central bank board member is sent a free copy of Rothbard’s Mystery of Banking except I am beginning to doubt their ability to read. All they have done is give banks the incentive to park money on sovereign bonds with diminishing yield.

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Balance Sheet Real Estate Banking Operations 65

MishTalk

NOVEMBER 20, 2013

Banks; Global Financial System is Bankrupt. Addendum: Société Générale disputes the numbers and new calculations using the banks'' numbers are 28:1 or perhaps 23:1 not 50:1 as noted on Forex Crunch. Banks do not plunge out of the blue on rumors. French Banking Primer. trillion balance sheet is leveraged nearly 49-to-1.

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Balance Sheet Banking Financial Finance 77

MishTalk

AUGUST 22, 2014

As noted in German Two-Year Bonds Have Negative Yield, Demand High; Euro Bond Bubble Guaranteed to Burst , " Banks lend (provided they are not capital impaired), when credit-worthy borrowers want credit and banks perceive risks worth lending." The New York Times DealBook explains Europe Fears Banks Lack Cash Cushion to Cover Bad Loans.

Banking 53

Banking Balance Sheet Metrics Government 53

MishTalk

DECEMBER 14, 2015

Merits of Not Shrinking the Balloon When the Fed first launched QE, they stated they had the "tools" necessary to shrink their ballooning balance sheet. Once the Federal Reserve lifts interest rates from near zero, likely this week, the focus will turn to the other legacy of the crisis-era policies: the Fed's swollen balance sheet.

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Balance Sheet Banking Tools Policies 28

MishTalk

DECEMBER 17, 2013

On December 12 the Financial Times reported EU reaches landmark deal on failed banks with a "common rule book for handling failed banks". The next day, a friend commented the banking union agreement proved me wrong. I replied "wait for the details". Some senior officials are warning the proposals are too cumbersome.

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Banking Finance Balance Sheet Financial 59

MishTalk

OCTOBER 26, 2014

In an effort to fool the public into believing the latest round of bank stress tests were actually designed to find stress, the ECB found 25 scapegoats, none of which were German banks. Reuters reports ECB Fails 25 Banks in Health Check but Problems Largely Solved. The 130 banks account for 81.6

Balance Sheet 64

Balance Sheet Banking Exercises Report 64

MishTalk

DECEMBER 9, 2014

ECB president Mario Draghi set out to stimulate bank lending by purchasing covered bonds. Covered bond supply has reached its lowest level in nearly two decades as the European Central Bank has been accused of crowding out investors from the market by pushing up prices and depressing yields. The buyer of only resort is the ECB.

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Marketing Balance Sheet Banking Policies 54

MishTalk

DECEMBER 23, 2013

The New York Times reports China Rates Approach Crisis Levels Despite Central Bank Measures. The central bank, the People’s Bank of China, said late Friday that it had provided more than 300 billion renminbi, or about $50 billion, in short-term funds to selected banks over a three-day period that week.

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Balance Sheet Banking Benchmarking Financial 66

MishTalk

MARCH 19, 2014

The Fed’s tapering merely slows the growth of its balance sheet. The rarely admitted truth, however, is that there is no need for central banks’ balance sheets to shrink. They could stay permanently larger; and, for some countries, permanently bigger central-bank balance sheets will help reduce public-debt burdens.

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Balance Sheet Banking Government Policies 55

MishTalk

NOVEMBER 6, 2014

Having already cut interest rates to record lows and saying they can go no lower, Draghi is now focused on boosting the ECB’s balance sheet. The ECB has issued long-term loans to banks and started buying covered bonds in the hope of flooding the economy with enough liquidity to ease credit constraints. Headwinds explain why.

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Balance Sheet Banking Government Policies 56

MishTalk

APRIL 7, 2014

In lengthy negotiations last month the EU reached a deal on how to handle failed banks. Please consider EU Deal on Bank Failures Risks Unravelling A landmark EU agreement on a common rulebook for handling bank failures is in danger of unravelling over the fine print restricting when a state can intervene to rescue a struggling bank.

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Banking Balance Sheet Finance Government 56

MishTalk

JANUARY 26, 2014

In Emerging Market Contagion Spreads , I presented a viewpoint that emerging market currencies have been under pressure because of falling commodity prices. To be fair, quite a few emerging market currencies as well as the currencies of developed countries that are large commodity exporters have been under pressure for some time.

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Balance Sheet Banking Tourism Sports 73

MishTalk

DECEMBER 4, 2013

Bove, one of the most widely-respected banking analysts in the world, is certain that will have devastating consequences for housing and the rest of the American economy. These securities are sold in order to add liquidity to the mortgage market, thereby making funds available to borrowers. "If And we won''t have fixed-rate mortgages."

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Government Balance Sheet Real Estate Banking 61

MishTalk

AUGUST 6, 2013

Minyanville Business and Market News. Balanced Budget Ammendment Sign the Balanced Budget Petition. Balanced Budget Ammendment Sign the Balanced Budget Petition. China Financial Markets. Market Oracle. Market Ticker. Real Clear Markets. The feds balance sheet doesnt reflect it.

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Balance Sheet Analysis Trends Real Estate 51

MishTalk

MAY 20, 2014

Yesterday, former fed chair Ben Bernanke said " No Need for Fed to Shrink Balance Sheet ". The Federal Reserve does not need to shrink its $4 trillion-plus balance sheet by even "a dime" for it to normalize monetary policy when the time comes, former Fed Chair Ben Bernanke said on Monday.

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Balance Sheet Strategy& Strategy Strategy 51

MishTalk

JANUARY 16, 2014

While the ECB confirmed that it will require lenders to have a capital ratio of 8 percent, what qualifies as capital will change over the course of the three-part assessment, the central bank said in an e-mailed statement. Given that requirement, banks could be forced to provision capital against potential risks from the exposure.

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Balance Sheet Banking Exercises Financial 61

MishTalk

DECEMBER 26, 2013

China''s Move to Market-Set Rates Let''s step back to December 8 and look at China Relaxes Grip on Interest Rates China is relaxing its grip on interest rates with the launch of a financial instrument that allows banks to trade deposits with each other at market-determined prices.

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Balance Sheet Marketing Banking Financial 51

Tom Spencer

AUGUST 25, 2018

By distributing 100 million sesterces from the imperial bank to reliable bankers around the Empire and dropping interest rates to zero for three years, Tiberius saved Rome and the other affected nations of Egypt, Greece, and France. In the face of illiquidity a bank cannot repay current liabilities or their depositholders.

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Financial Balance Sheet Banking Policies 60

MishTalk

DECEMBER 26, 2014

Next year will be a very important year for China because possible strains in the banking system and the intensity with which the reformers present their case will give us a better sense both of how much debt capacity the country retains and of how well positioned Xi Jinping and his allies are to implement the needed reforms.

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Banking System Benchmarking Finance 57

MishTalk

DECEMBER 24, 2013

All I did was quote a French blogger on bank leverage, and the numbers I quoted were matched by the Wall Street Journal. Wolf Richter at the Testosterone Pit commented on Gagging Doubt: French Crackdown On French And American Bloggers Who Question Megabank Balance Sheets The France''s Financial Markets Authority (AMF) announced on Nov.

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Balance Sheet Banking Financial Journal 68

MishTalk

SEPTEMBER 23, 2013

I received several emails regarding my post on Risk-Free Banking and Fractional Reserve Lending that I would like to share. When I began investing, one looked at the real property on balance sheets. Indeed, as it stands banks are always bailed out at taxpayer expense, the very epitome of "moral hazard". Hello Mish.

Banking 50

Banking Balance Sheet Policies Travel 50

MishTalk

NOVEMBER 27, 2013

On October 23, ECB president Mario Draghi announced new bank stress tests. Draghize : "Banks do need to fail to prove the credibility of the exercise". Mish : We are carefully scrutinizing several non-critical banks, looking for a couple of scapegoats, hoping to fool the public regarding the credibility of the exercise.

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Balance Sheet Exercises Banking Government 52

MishTalk

FEBRUARY 6, 2014

In addition to holding its benchmark rate at 0.25%, the ECB also left the rate it pays on bank deposits unchanged at zero. The eurozone is doing so by accident, letting market forces drain liquidity from the financial system for month after month. Banks refusal to lend is not passive tightening. The answer is no." in December.

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Balance Sheet Banking Retail Policies 57

MishTalk

JULY 11, 2014

The question stems from lengthy (256 page PDF) from the BIS Annual Report (Bank for International Settlements) that stated among other things " The only source of lasting prosperity is a stronger supply side. The BIS slam, coupled with a recent stock market selloff, brought up debate on a " controlled collapse ".

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Balance Sheet Financial Banking Policies 61

Tom Spencer

NOVEMBER 17, 2018

This is because the initial trigger for the crisis was reliance by major banks, particularly those in the United States, on mortgage backed securities as collateral. Once the housing market began to collapse, mortgages defaulted, and MBS began to fail. These repackaged securities were called collateralized debt obligations (CDOs).

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Financial Banking Balance Sheet Cash Flow 60

MishTalk

DECEMBER 16, 2014

Russia’s central bank is actually known for being quite conservative. Instituting massive rate hikes in such a situation is certainly a better approach than wasting foreign reserves in market interventions. See above link for charts on Russia money supply growth and Russia''s central bank balance sheet.

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Balance Sheet Banking Energy Marketing 58

MishTalk

SEPTEMBER 18, 2014

The European Central Bank’s first offer of cheap four-year loans has fallen short of expectations, dealing a blow to president Mario Draghi’s hope of sustaining the eurozone’s ailing economy by expanding the central bank’s balance sheet. Why TLTRO Won''t Spur Lending Banks may eventually take the money.

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Balance Sheet Banking Operations Policies 53

Harvard Business

OCTOBER 31, 2017

Just over 10 years ago, French bank BNP Paribas froze U.S. The market panicked. There was a run on British bank Northern Rock. Over the next year, many banks fell. Investment bank Bear Stearns collapsed. We expect investment banks to embark on an even more fundamental makeover during the next decade.

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Banking Balance Sheet Financial Finance 28

MishTalk

AUGUST 22, 2013

From 1997-2000 the Fed ignored a major bubble in the stock market. Then in an effort to bail out the banks (typically overweight bubble assets) the Fed steps on the gas again. Here is the reality: Those with first access to money, the banks and already wealthy are the only ones who benefit from inflation. How Convenient!

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Balance Sheet Real Estate Banking Government 59

MishTalk

SEPTEMBER 4, 2014

This reflects the role of the ABS market in facilitating new credit flows to the economy and follows the intensification of preparatory work on this matter, as decided by the Governing Council in June. Judging from today''s reaction, the market may not have expected this big of an announcement. Banks if and only if.

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Banking Balance Sheet Government Comparison 61