Rakesh Saxena

Will the Counterparty/Systemic Risk Relationship Undermine Banks?

Mark, "eating away" was the phrase I was looking for. Thanks - Rakesh


On Oct 04 07:56 PM Mark Bern wrote:

> Excellent article! You have hit upon the question that has been swept
> under the proverial rug by Wall Street, the Fed, and the Administration.
> Ignoring the problem does not fix the problem. However, that is the
> primary action that has been taken by our leaders in hopes that it
> may go away or miraculously fix itself. It is, as you pointed out,
> as systemic risk that won't go away. The web needs to be untangled
> and chips fall where they will so that we can deal with the real
> problem underlying our economy. As long as it is kept hidden, eating
> away at bank solvency over time, it will continue to be a major drag
> on any recovery. Without attending to the root of the problem, we
> will be mired in a slow growth envirionment with inadequate credit
> availability to sustain the level of new business formation needed
> to create positive employment.
>
> We must go through some pain and recognize the losses on worthless
> (or near worthless) assets for the delveraging process to accomplish
> the necessary cleansing of the economy. Without that step, we will
> just continue to hobble along, with the government taking on more
> and more debt against the future, making recovery to an economic
> environment of real growth impossible.
>
> Thank you for trying to keep us informed of what really matters.

Will the Counterparty/Systemic Risk Relationship Undermine Banks?

Thank you Swashbuckler.


On Oct 04 04:29 PM Swashbuckler wrote:

> Rakesh----Welcome back to SA. I always look forward to your posts.
> Here's hoping you are doing well and will be able to continue posting
> here for a long time.