JeffWartman
Senior Member
Our economy could be headed for a serious crisis...
Full story: http://news.independent.co.uk/business/news/article3132507.ece
Markets fear banks have $1 trillion in toxic debt
By Sean OGrady, Economics Editor
Published: 06 November 2007
A new phase in the credit crunch, one of $1 trillion losses seems to be dawning. The crisis at Citigroup and renewed doubts about some of the worlds leading banks disquieted stock markets on both sides of the Atlantic yesterday, with the fractious mood set to continue.
The FTSE 100 fell 69.2 to 6,461.4, with Alliance & Leicester (down 4 per cent) and Barclays (off 3 per cent, to a two-year low) singled out for punishment. In New York, Citigroup, down |4.9 per cent to multi-year lows, weighed on the Dow Jones index, which fell 51.7, or 0.4 per cent, to 13,543.4. Merrill Lynch, Goldman Sachs and Lehman Brothers also dropped on speculation they face more writedowns on top of the $40bn (£19bn) announced in the past four months.
Bill Gross, the chief investment officer of Pacific Investment Management, said US mortgage delinquencies and defaults would rise in 2008. There are $1 trillion worth of sub-primes, Alt-As [self-certified] and basically garbage loans, he said, adding that he expects some $250bn in defaults. Weve only begun to see the pain from rising mortgage payments, he added. Brian Gendreau, an investment strategist at ING, commented: Financials are 20 per cent of the S&P 500 and if that sector doesnt do well all bets are off. People just dont know whats on the balance sheets. ...
Full story: http://news.independent.co.uk/business/news/article3132507.ece
Markets fear banks have $1 trillion in toxic debt
By Sean OGrady, Economics Editor
Published: 06 November 2007
A new phase in the credit crunch, one of $1 trillion losses seems to be dawning. The crisis at Citigroup and renewed doubts about some of the worlds leading banks disquieted stock markets on both sides of the Atlantic yesterday, with the fractious mood set to continue.
The FTSE 100 fell 69.2 to 6,461.4, with Alliance & Leicester (down 4 per cent) and Barclays (off 3 per cent, to a two-year low) singled out for punishment. In New York, Citigroup, down |4.9 per cent to multi-year lows, weighed on the Dow Jones index, which fell 51.7, or 0.4 per cent, to 13,543.4. Merrill Lynch, Goldman Sachs and Lehman Brothers also dropped on speculation they face more writedowns on top of the $40bn (£19bn) announced in the past four months.
Bill Gross, the chief investment officer of Pacific Investment Management, said US mortgage delinquencies and defaults would rise in 2008. There are $1 trillion worth of sub-primes, Alt-As [self-certified] and basically garbage loans, he said, adding that he expects some $250bn in defaults. Weve only begun to see the pain from rising mortgage payments, he added. Brian Gendreau, an investment strategist at ING, commented: Financials are 20 per cent of the S&P 500 and if that sector doesnt do well all bets are off. People just dont know whats on the balance sheets. ...
