Writedown news: 28 Aug 2008
Below are the latest writedown stories from the web that I have seen. For the full timeline of news, visit my credit crisis timeline. Bloomberg recently updated their tally of writedowns to arrive at $503.8 Billion to date. That is on the timeline as well.
Also see my list of Bankrupt Global Financial Institutions.
Some of the National Post pictures accompanying the earnings reports are pretty funny: it’s like they rolled across the street in Toronto and snapped a Polaroid of the Bank’s building logo. Check out the BMO, TD and RBC photos to see unwilling photo participants. At least the CIBC photo has no people in it.
2008 08 20 JPMorgan Warned California as Auction Market Neared Collapse
2008 08 20 Fed’s Lacker Clashes With Paulson on Fannie-Freddie Strategy
2008 08 20 FDIC Releases Details on IndyMac Loan Mods; Questions Remain
2008 08 20 California mulls probing senator over IndyMac crash
2008 08 20 Possible Lehman asset management sale portends pain
2008 08 20 Lehman’s secret talks to sell 50% stake stall
2008 08 20 Fannie Mae and Freddie Mac shares fall on fears of size of potential losses
2008 08 20 Wachovia Unloads Troubled Loans
2008 08 21 Fed Acted on Lehman Rumor
2008 08 21 Lone Star Funds to take over IKB
2008 08 24 Danish Central Bank, Grouping Acquire Roskilde Bank
2008 08 26 Housing slump hits BMO’s bottom line
2008 08 26 Scotiabank earnings slip 2%
2008 08 27 CIBC profit squeezed by $885-million credit hit
2008 08 28 Agricole, Natixis earnings plunge on market turmoil
2008 08 28 C.Agricole Q2 profit plunges on Calyon loss
2008 08 28 TD’s profit drops, but bank hikes dividend
2008 08 28 National Bank profit rises
2008 08 28 U.S. operations bite into Royal Bank’s profit
That $503.8 billion (I lvoe the spurious accuracy) takes us about half way to original estimates of $1 trillion. How much further do you think we have to go?
Hilarious. It is pretty spurious, huh? I think we are less than halfway through.
What I’m hearing is:
1. Declines in the UK will be as severe as the US.
2. Ireland and Spain are also declining and will suffer major losses. There is the rumour that there may be bankruptcies in Spanish banking coming. Apparently the Baltics are getting hammered as well but there is little news on that.
3. A few bubble markets that have not hit the screen are now in decline: Denmark, Australia and Canada in particular.
4. In the US, prime loans are defaulting at a higher rate as are Alt-A
4. The global economy is having a recession, so thee will be inherent real economy feedback loops.
All of this says that Europe will see considerable losses (same order of magnitude as the US) and the US must see more as well.
I had been guessing $900 billion until about a month or two ago. Now, it’s looking more like one-and a-half billion.