Posted 2007-07-20 21:48
by Karl Denninger
by Karl Denninger
Short and sweet.
"Its all contained". Remember that?
Really?
No, actually its not. In fact, its far worse than you think.
Lookie what showed up on a nasty little document from the Fed. Oh, its hidden. You might not even notice it unless you looked closely. I missed it the first time I looked.
You probably would too.
That's ok.
I'll tell you where to look. Page 13, line item #34.
Its a 1,214.6B (that'd be 1.2146 Trillion with a "T") exploding debt bomb, and its on the balance sheets of "Large, Domestically-Chartered Banks".
For some sobering perspective on exactly how much this really is, have a look at the total deposits on hand, and the total assets of these institutions. That's all in the same document too.
Now take a long, hard look at that ABX again, and tell me what sort of impairment you think there might of this alleged "asset", which has not been marked to the market.
You might also note that until a couple of weeks ago, this line item didn't exist on that report.
Where'd it come from and why has it suddenly - almost magically - appeared?
Think we might have something like this coming in the credit markets?
"Its all contained". Remember that?
Really?
No, actually its not. In fact, its far worse than you think.
Lookie what showed up on a nasty little document from the Fed. Oh, its hidden. You might not even notice it unless you looked closely. I missed it the first time I looked.
You probably would too.
That's ok.
I'll tell you where to look. Page 13, line item #34.
Its a 1,214.6B (that'd be 1.2146 Trillion with a "T") exploding debt bomb, and its on the balance sheets of "Large, Domestically-Chartered Banks".
For some sobering perspective on exactly how much this really is, have a look at the total deposits on hand, and the total assets of these institutions. That's all in the same document too.
Now take a long, hard look at that ABX again, and tell me what sort of impairment you think there might of this alleged "asset", which has not been marked to the market.
You might also note that until a couple of weeks ago, this line item didn't exist on that report.
Where'd it come from and why has it suddenly - almost magically - appeared?
Think we might have something like this coming in the credit markets?
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