The Economist (August 20)
“What are the most dysfunctional parts of the global financial system?” While here are many candidates, “if sheer size is your yardstick, nothing beats America’s housing market.” At $26 trillion, “it is the world’s largest asset class” and “the slab of mortgage debt lurking beneath it is the planet’s biggest concentration of financial risk.” This wasn’t fully sanitized in the wake of the financial crisis. “Vast, nationalised, unprofitable and undercapitalised, it remains a menace to the world’s biggest economy.”
Tags: Asset class, Dysfunctional, Financial risk, Global financial system, Housing market, Mortgage debt, Size, U.S.
Euromoney (July issue)
“Market share of financial businesses vital to supporting global economic growth is concentrating rapidly into the hands of a small group of the world’s biggest banks.” During the first half of 2013, the top 10 banks commanded 56% of all investment banking fees. This “does not look a particularly welcome development, increasing as it does, the dependence of corporations, governments, large investors and other banks on just a few providers and along with it the exposure of the global financial system to risk of failure at any of these top 10.”
Tags: Banks, Economic growth, Exposure, Fees, Global financial system, Investment banking, Investors, Market share, Risk
