U.S. lenders probably need to suspend dividends and begin raising capital due to their exposure...

U.S. lenders probably need to suspend dividends and begin raising capital due to their exposure to Italy, writes Simon Johnson. Italy could be headed into a viscous cycle where austerity leads to worsening deficit/GDP numbers, leading to more austerity. Italy is too large to be bailed out. The end of moral hazard will be a new experience for banks.

Comments (7)
  • Barry Crocker
    , contributor
    Comments (450) | Send Message
    Perhaps we should all dig a hole and bury ourselves. The Sky is Falling !!
    5 Jul 2011, 05:16 PM Reply Like
  • Tack
    , contributor
    Comments (16364) | Send Message


    I often wonder what all these Cassandras do with their money, since they spend 24/7 terrified about the next hopeless, unsurvivable event, each of which arrives on the horizon as soon as the last one has proven manageable. Believing in failure has become an industry, a rather pathetic one, at that.
    5 Jul 2011, 05:26 PM Reply Like
  • Barry Crocker
    , contributor
    Comments (450) | Send Message
    It's more hope than expectation.


    The coverage this week has been hysterical.
    5 Jul 2011, 05:44 PM Reply Like
  • cpickett
    , contributor
    Comments (57) | Send Message
    yes what a wonderful experience for bankers.......i would LOVE to see there dispair....the leach Fker's.


    But i suppose the creative efforts combined with the leverage and power of the financial lobby and their political influence will lead to find a way for the global banks with CDS exposure to not take a LOSS and continue to be able to let this FINACIAL TERRORISM become more of a national security threat to our Country. The congress be enabling them are traitors. this is not a difficult case to make...although not inspirational. lol
    5 Jul 2011, 05:28 PM Reply Like
  • The Sane Investor
    , contributor
    Comments (354) | Send Message
    It's been funny to watch the see-saw "hope vs. despair" cycle regarding the Euro region. Looks like we're back to despair.


    Italy will likely depart the Euro before default.
    5 Jul 2011, 06:05 PM Reply Like
  • LuckyPick
    , contributor
    Comments (740) | Send Message
    despite all the negativity and speculations, Euro is not going to parity against the dollar
    who's worse off now? US or europe? lol
    5 Jul 2011, 06:30 PM Reply Like
  • valueinvestor123
    , contributor
    Comments (325) | Send Message
    No country is too large to bailout in the minds of those in charge. The powers that be will sink 99% of the world's population to save the banks and the ultra wealthy.
    5 Jul 2011, 08:59 PM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs