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Kevin Mao

Definitions - 12 views

Interest - "1. The charge for the privilege of borrowing money, typically expressed as an annual percentage rate. 2. The amount of ownership a stockholder has in a company, usually expressed as a...

started by Kevin Mao on 18 Apr 12 12 follow-ups, last by Kevin Mao on 18 May 12
kevinan108

Spain banking sector shaken by report of bank run | CanadianBusiness.com - 0 views

www.canadianbusiness.com/...r-shaken-by-report-of-bank-run

Spain EuropeanCrisis banks banking nationalization runonbanks

shared by kevinan108 on 17 May 12 - No Cached
  • Confidence in Spain's banks and its teetering economy was shaken Thursday after a newspaper reported that depositors were rushing to withdraw their money from Bankia, a troubled bank that was effectively nationalized just one week ago.
  • Adding to the anxiety, rating agency Moody's downgraded its credit ratings on Spanish banks.
  • Political turmoil in Greece has increased the likelihood that it could leave the 17-country monetary union, a move that could have ripple effects throughout Europe and the world's financial markets.
  • ...3 more annotations...
  • Bankia SA, the country's fourth-largest lender, saw its shares fall as much as 27 percent during trading in Madrid after the El Mundo newspaper reported the bank was hit with more than €1 billion ($1.27 billion) of withdrawals since the government announced the takeover.
  • Greek president Karolos Papoulias warned party leaders during unsuccessful coalition talks that about €700 million ($898 million) in deposits have flown out of Greek banks since the May 6 elections, according to a report from Greece's central bank governor, George Provopoulos
  • the interest rate on Spanish 10-year bonds stood at a worryingly high 6.29 percent. It has risen sharply from below 5 percent in March and is edging toward the 7 percent mark that is considered unsustainable in the longer term.
stefan ayache

12-year-old Ontario girl slams modern banking system, becomes YouTube hit - thestar.com - 1 views

www.thestar.com/...ng-system-becomes-youtube-star

shared by stefan ayache on 17 May 12 - No Cached
  • Canada’s banking system has been the subject of international praise from economists grappling with global turmoil, but one 12-year-old girl begs to differ
  • earning a reputation as a financial pundit after her tirade against her homeland’s borrowing practices
  • already a veteran of the financial lecture circuit
  • ...11 more annotations...
  • reasons why so many of the world’s countries are facing staggering debt
  • aim at Canada’s modern day financial system and champions a greater role for the country’s central bank
  • The banks and the government have colluded to financially enslave the people of Canada
  • a brief history of the Canadian banking system, referencing obscure historical figures
  • governments began borrowing from private banks instead at considerably higher interest rates than those available through the central bank
  • The result, Grant argues, is a rapidly increasing national debt
  • If the Canadian Government needs money, they can borrow it directly from the Bank of Canada
  • arguing borrowing from the Bank of Canada would shore up depleted government resources and usher in an era of prosperity for Canada
  • Such a change in monetary policy, combined with crucial changes in tax policy, would make available tens of billions of dollars that are urgently needed to rebuild our public infrastructure, protect our environment, and strengthen Medicare and other social programs so vital in meeting human needs
  • Critics of Crowell’s arguments contend inflation rates would soar if the central bank was able to lend money below commercial interest rates
  • Others, however, were skeptical that Grant’s words were truly her own
stefan ayache

Hedge Funds Are Shadow Banks in Need of Regulation, Bafin Says - Bloomberg - 1 views

www.bloomberg.com/...-of-regulation-bafin-says.html

shared by stefan ayache on 17 May 12 - No Cached
  • Hedge funds act as shadow banks and should be added to the list of organizations in need of regulation
  • Germany’s financial regulator Bafin.
  • Shadow-banking definitions by the Financial Stability Board
  • ...26 more annotations...
  • are too narrow
  • Bafin is working on its own proposals to regulate the sector
  • make dodging rules more tedious and expensive
  • So-called shadow banking that takes place outside the scope of regulators is being targeted by financial watchdogs on concern that it may be used to evade a global clampdown on excessive risk-taking
  • The FSB
  • established a list of shadow-banking activities that may warrant tougher oversight
  • will seek agreement on the rules by the end of 2012
  • Authorities should know why money is deposited offshore
  • need for additional rules for derivatives
  • credit-default swaps
  • who should be allowed to sell CDS
  • purchase of the instruments should be restricted
  • the CDS market still isn’t transparent
  • tripling how much core capital lenders must hold to at least 7 percent of assets
  • how much freedom national regulators should have to go beyond minimum EU capital rules
  • Finance ministers are set to discuss the rules again at a meeting in Brussels
  • German banks that lend to local economies dominated by medium-sized companies are seeking to loosen standards for risk weighting of these loans
  • The current crises were caused by subprime and government bonds
  • force banks to hold Tier 1 capital equivalent to 3 percent of their total assets
  • would prevent lenders from accumulating assets worth more than 33 times their reserves
  • The measure is needed to stop banks from evading other capital rules
  • considering how to expand the range of assets that qualify as highly liquid
  • concerns that the current list is too narrowly focused on government debt
  • survive a 30-day credit squeeze
  • set to take effect in 2015
  • We, for example, have a huge government bond market; others don’t
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