One of my hugely plugged in buddies has been warning that European banks are even more wobbly than US ones, and the ECB will wind up, like the Fed, cutting rates to as close to zero as it dares.
Some of his grim view is based on the fact that EU banks on average are much more highly geared than their US peers, and they were buyers of the dreckiest, end of credit cycle CDOs and structured credits.
But I wonder if he knew about this item too….(hat tip reader Richard)
The more information comes out, the more the financial industry looks like a house of cards. Is this the reason that the authorities have been reluctant to go in the direction of more transparency, despite the frequent calls for it? Particularly when more disclosure might reveal that they were asleep at the switch in the credit bubble?