prudentinvestor

Wall Street Breakfast: Must-Know News

Almost a footnote at the end of the page: "Georgia-based Southern Community Bank's closure will cost the FDIC $114M. North Carolina-based Cooperative Bank's closure will cost the FDIC $217M. Kansas-based First National Bank of Anthony's closure will cost the FDIC $32.2M."

These add up to roughly $365m, which is roughly the cost to the taxpayers of the entire real estate crash of the late 1980's.

In other words, the total cost to the taxpayers of the previous, disastrous real estate crash of twenty years ago is now treated as a minor footnote, repeated on a weekly basis, and almost unnoticed. Last time, fraudulent bankers were led in chains by the FBI, and this time they are getting bonuses. Is this the "change we can believe in" ?

Preview from Europe: Profit Taking Pushes Market Down

Mole, you are quite right: "..The harsh reality remains that the economic and earnings backdrop is not improving one iota...."

I would add another harsh reality, that all the desparate, misguided and inflationary policy measures undertaken by Western countries are intended to prop up artificially oversized financial sectors that have sucked the blood out of the productive sectors of their economies. Even if successful, the resulting recovery cannot be healthy, as these multi-trillion dollar bailouts are drawing away even more resources from the remaining, dwindling productive sectors.

China is fortunate that they have not had time to develop a punitively oversized financial sector, and now they have learnt, at our expense, that they need to avoid it.