nbdubya

Clock is Ticking for Banks With Asset Quality Issues

Amazing that, with asset quality sliding fast, banks just keep on using the same tools that got them into this mess ...

nik-o-laus.blogspot.co...

nik-o-laus.blogspot.co...

How Deceitful Are the Big Banks?

In banking, the underlying product is entirely homogenous: a buck is a buck is a buck. Textbook hypercompetition. Necessarily, the banks must find other ways of getting ahead. If it's not illegal, they'll do it. Survival of the fittest is the mantra when when there's money to be made. The same hands-off rigor needs to apply when they're on the skids, though. Those that take big risks and lose need to go extinct. Those that can't evolve and stay competitive need to go too. Central bankers are in the midst of a critical bungle by meddling in the field (with our tax dollars!).

Shameless self-promotion: I discussed the motivations and consequences of this meddling in a recent blog series.

nik-o-laus.blogspot.co...

nik-o-laus.blogspot.co...