Salient to Investors: Total loans at the four largest U.S. banks fell 4.9 percent in Q1 versus an increased of 9.8 percent for the 17 smallest of the 24 firms in the KBW Bank Index. David Trone at JMP Securities said the big banks’ shrinking loans has earnings implications, because the removed loans,
READ MORE... →Salient to Investors: Simon Johnson at MIT Sloan School of Management says: The euro area faces a major economic crisis, most likely a series of rolling, country-specific problems involving some combination of failing banks and sovereigns that can’t pay their debts in full. Expect system wide stress, emergency liquidity loans from the
READ MORE... →Salient to Investors: Every measure of risk in the credit markets shows the banks enjoy greater confidence among investors now than before Moody’s downgrades. Richard Bove at Rochdale Securities says Moody’s downgrading the debt of companies that investors want to buy is the most obscene act he’s ever seen by a major institution. Money managers
READ MORE... →Salient to Investors: German auto rebates on new cars rose to a seven-year high in June. Moody’s cut the ratings of 15 global banks due to their significant exposure to the volatility and risk of outsized losses. Predictions: Lucy MacDonald at RCM expects extremely low growth, low interest rates and much politically driven volatility
READ MORE... →Salient to Investors: Downgrades of 15 global banks by Moody’s Investors Service were met instead by rallies in stocks and bonds. Gerard Cassidy at RBC Capital Markets said American banks are stronger than three years ago, and market prices have long reflected concerns raised by Moody’s. Moody’s announced on Feb. 15 that it was reviewing the
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