COMMON SENSE

It’s Not a “Wonderful Life”, as posted by

Monty Pelerin’s World , Economics, Finance and Politics Through The Prism of Classical Liberalism

The overhang to any economic recovery is the banking system. There is no way to know how bad the banking problems really are, given the accounting or lack thereof. Banks, with an encouraging wink and a nod from regulators, have refused to realistically value their assets. In some cases, these values may not even be determinable, other than to say they are currently grossly overvalued.

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US Banks & The FDIC, Are Delaying Their Losses

Posted by Larry Doyle on December 3, 2009

Postponing losses in hopes that one can trade out of them is a game very rarely won. In similar fashion, not acknowledging losses in hopes that the situation improves and the loss is mitigated is also a recipe for disaster. All one needs to do is look eastward to Japan to realize that. Ultimately, a loss not only must be realized, but paid.

Technorati Tags: Asset, bank, Banking Services, Banks and Institutions, business, Federal Deposit Insurance Corporation, financial services, government, Larry Doyle

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Biggest banks loan money to commercial real estate developers are a leading the way to troubled bank list by the FDIC.  The FDIC trouble bank list now has over 500 banks which could collapse any day! Unless President Barack Obama addresses the structural problems that caused the recession–bad loans and securities on the balance sheets of regional banks and huge trade deficits on oil and with China–the recovery will not be strong … Regional banks labor under the weight of commercial real estate failures. Meanwhile the Chief Community organizer AKA Barack Obama, should be heading back to his home town to help put out the fires he createt through his bronw shirt organization ACORN, to rescue 39 Chicago Banks with bad real estate loans!

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Rod Dreher from Crunchycon , a conservative blog about politics and religion,  says

“A year from now, the landscape of America will be forever changed. The office and retail markets will be vastly different than they look today. Not much of it will be good. Five years from now, will empty shopping centers and auto dealerships remain shuttered or will they be rebuilt or torn down and their use converted to something more productive? Will our politicians cease their meddling in the market and allow the market to heal itself? These are questions that will haunt our economy for the next decade.”

There have been 124 bank failures this year as toxic assets, including mortgages and construction loans gone bad, have mounted on lenders’ balance sheets.

Technorati Tags: Barack Obama, business, China, Commercial property, FDIC, Federal Deposit Insurance Corporation, politics, Real estate, Real Estate Loans

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L. William Seidman is the chief commentator on cable network’s CNBC-TV and publisher of “Bank Director” magazine. He is also one of the principal founders of Grand Valley State University in Michigan, where the Seidman College of Business was named in honor of his father…

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Prior to that, he served as the fourteenth chairman of the Federal Deposit Insurance Corporation from 1985 to 1991. He became the first chairman of the Resolution Trust Corporation (RTC) in 1989 and served until 1991.

During his tenure at the FDIC, the agency handled over one thousand bank failures and took over the administration of the insurance fund of the S&L industry. While at the RTC, he supervised the creation of an 8,000 person agency handling over $400 billion in assets from failed S&Ls. He brought to the position a record of accomplishments as a businessman, educator and public servant.

Gazette – http://www.thenedgazette.com/

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Technorati Tags: Bank failure, Federal Deposit Insurance Corporation, Grand Valley State University, insurance, L. William Seidman, michigan, Resolution Trust Corporation, United States

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by

STEVENSON JACOBS

NEW YORK — The head of the Federal Deposit Insurance Corp. said Tuesday she’s “very worried” that the nation’s biggest banks aren’t lending enough and warned the economy could take another turn for the worse without increased access to credit.

FDIC Chairman Sheila Bair said the FDIC’s upcoming quarterly report would show that “not many large institutions are doing a very good job of lending.” Instead, she said, some are taking advantage of near-zero interest rates by borrowing dollars cheaply to buy higher-yielding assets like stocks or commodities – a move known as the “carry trade.”

Addressing the rash of bank failures, Bair said the FDIC had enough funds to shut down troubled banks and would tap its line of credit with the Treasury only as a last resort. There have been 120 bank failures this year, …

The Huffington Post

Technorati Tags: bank, Bank failure, business, FDIC, Federal Deposit Insurance Corporation, financial services, Line of credit, Sheila C. Bair

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