New York Times (March 21)
“The lessons of the last financial crisis are clear. Less clear is whether regulators have the tools and the willingness to apply what they have learned to new circumstances and new threats.” The surge of money from China into the U.S. “far outpaced growth in the overall economy last year, a sign that too much money may be chasing too few good opportunities and that lenders may be compromising standards.” There are clear reasons for concern. “The system is still too opaque, and resistance to regulation remains fierce.”
Tags: China, Financial Crisis, Growth, Lenders, Opaque, Opportunities, Regulators, Resistance, Standards, Threats, U.S.
Euromoney (November Issue)
Despite the relative success of recent stress tests, “the financial sector remains at the core of the eurozone’s economic woes. Weak corporates and overleveraged households continue to weigh on bank balance sheets and lenders across the region remain vulnerable to write-downs.” The “flimsy” stress tests failed to “address the underlying problems of bad credit that slow growth and lowflation are compounding…. The euro banking crisis remains.”
Tags: Bad credit, Balance sheets, Economic woes, Euro banking crisis, Financial sector, Households, Lenders, Lowflation, Overleveraged, Stress tests, Write-downs
New York Times (August 7)
The “government rescue of one of Portugal’s largest lenders” is another example of “regulatory failure.” Banco Espírito Santo had succeeded in a system that made “it easy for banks to look good and hide their problems.” As the European Central Bank (ECB) moves to assume supervision for some of Europe’s largest banks later this year, it will have to show that it really is serious. “Europe’s economy will not recover until its banking system is truly healthy.”
Tags: Banco Espírito Santo, Banks, ECB, Economy, Europe, Government, Lenders, Portugal, Recover, Regulatory failure, Rescue
Bloomberg (July 15)
“Cross-border private capital is so readily available for good emerging-market borrowers that multilateral lenders such as the World Bank are having to explain why they’re needed any longer. To justify their existence, they’re trying to recast themselves as repositories of development expertise.” With the BRICS poised to create their own new currency reserve fund and development bank, the proposed institutions look anachronistic. The BRICS just “don’t need their own bank.”
Tags: Borrowers, BRICS, Capital, Cross-border, Currency reserve fund, Development bank, Emerging market, Lenders, World Bank
