2012 Coming Bank Collapses?

[jeffontherock]

Its looking increasingly likely that we are in for a number of Banking meltdowns this year, the downscaling, staff reductions and asset sales already began in earnest q3 q4 2011. This excellent article from a leading thinktank(82% correct predictions in 2011) explains it well and makes some very worrying forecasts for the european and uk banking systems. BNP Paribas is looking very shaky and it happens to have a couple of operations over here!:

 

http://www.europe202...icle712〈=en

 

My questions is to anyone who can offer information are the following:

 

1. Reference our Island, how many of the population are employed in the finance sector? and are there contingency plans for retraining/alternative employment should a large percentage of those workers become unemployed in the coming 12 months?

 

2. Does the IOM have sufficient investment in manufacturing/farming/services/infrastructure projects and other non finance industries to soak up the possible sudden increase in the unemployed?

 

 

anyone ??

 

And happy new year everyone, enjoy it as though everything will go well!! and it probably will!! but make a few small preperations just in case it does not!

 

GOOD LUCK FOR 2012

 

jeff

[Slim]

Its looking increasingly likely that we are in for a number of Banking meltdowns this year, the downscaling, staff reductions and asset sales already began in earnest q3 q4 2011. This excellent article from a leading thinktank(82% correct predictions in 2011) explains it well and makes some very worrying forecasts for the european and uk banking systems. BNP Paribas is looking very shaky and it happens to have a couple of operations over here!:

 

I think BNP Paribas have already exited the island, or at least wound things down to virtually nothing.

 

1. Reference our Island, how many of the population are employed in the finance sector? and are there contingency plans for retraining/alternative employment should a large percentage of those workers become unemployed in the coming 12 months?

 

2. Does the IOM have sufficient investment in manufacturing/farming/services/infrastructure projects and other non finance industries to soak up the possible sudden increase in the unemployed?

 

1. A significant percentage directly employed, and if you include indirect supporting and benefiting from banking, it's even higher.

 

2. No.

[Lxxx]

It looks like we're going to have some career bankers pulling pints in The Courthouse soon.... I can see thousands of work permits not getting extended in 2012.

[manshimajin]

This data is from 2006 census but I would guess is roughly OK. The private sector at that time accounted for 31,000 of the total jobs of about 40,000. So at that stage the FS sector was about 7,000 or about 22%. But as Slim rightly says there are other jobs that are dependent on the sector - probably quite a few.

 

I was looking for the financial services contribution to GDP. Numbers seem to be very generalised but the combined sector contributes to over half the GDP of the island.

 

I think the real issue is not a 'spectacular' collapse of one bank - though this will be significant - but the continuing erosion of confidence in the financial sector both because of its overall economic vulnerability and because of its continuing failure to deal with its own problems. As has been seen recently once more, banks are not willing to lodge their own money with other banks. If banks don't trust each other why should their clients?

[Lxxx]

Decreasing confidence will only have a limited effect, at the public's level, due to the fact that most of them wouldn't/haven't got a clue as to what to do with their wealth apart from invest it all in the banking system. The same goes for most people who work in finance. I have had many conversations with friends who work in the large banking institutions in Douglas, in varying senior positions, and every single one of them didn't have any idea about the bigger financial picture, and aren't really interested in finding out. They just go through the motions everyday playing with numbers on computer screens, shuffling it here, there and everywhere for clients who are equally as clueless but who pay them to make decisions about there money. They do all this with blinkers on as they can't see the wood for the trees, and that's what the industry is keen to maintain in order to keep the bankrupt system afloat as long as possible.

 

The media and government in conjunction will do their utmost to keep the severity of the situation under the surface for as long as possible, in order to avoid the collapse of the golden goose and then watch the economy unravel rapidly afterwards.

[manshimajin]

Decreasing confidence will only have a limited effect, at the public's level, due to the fact that most of them wouldn't/haven't got a clue as to what to do with their wealth apart from invest it all in the banking system.

I think it does with wealthy individuals and organisations that seek to use offshore financial centres. Not with the small punters - and lets face it even the wealthy here, with one (or two) exceptions, are not big league players in terms of the global wealthy. They'd be living in Monaco if they were!

 

Sadly I concur with your comments about the quality of financial services staff. They mostly seem to be junior 'middle-men' pushing information between clients and the decision makers elsewhere. They do still want their bonuses...

[Blade Runner]

Decreasing confidence will only have a limited effect, at the public's level, due to the fact that most of them wouldn't/haven't got a clue as to what to do with their wealth apart from invest it all in the banking system. The same goes for most people who work in finance. I have had many conversations with friends who work in the large banking institutions in Douglas, in varying senior positions, and every single one of them didn't have any idea about the bigger financial picture, and aren't really interested in finding out. They just go through the motions everyday playing with numbers on computer screens, shuffling it here, there and everywhere for clients who are equally as clueless but who pay them to make decisions about there money. They do all this with blinkers on as they can't see the wood for the trees, and that's what the industry is keen to maintain in order to keep the bankrupt system afloat as long as possible.

 

The media and government in conjunction will do their utmost to keep the severity of the situation under the surface for as long as possible, in order to avoid the collapse of the golden goose and then watch the economy unravel rapidly afterwards.

 

Take a single big bank in the UK for an example for a moment say RBS, IF that collapsed and all the people and company's that had money in it were suddenly unable to access their money or it had actually disappeared what would happen? The whole UK and island would shut down, lots of people unable to pay their bills or buy food etc etc.

 

Do you really think this will happen?

[Lxxx]

Decreasing confidence will only have a limited effect, at the public's level, due to the fact that most of them wouldn't/haven't got a clue as to what to do with their wealth apart from invest it all in the banking system. The same goes for most people who work in finance. I have had many conversations with friends who work in the large banking institutions in Douglas, in varying senior positions, and every single one of them didn't have any idea about the bigger financial picture, and aren't really interested in finding out. They just go through the motions everyday playing with numbers on computer screens, shuffling it here, there and everywhere for clients who are equally as clueless but who pay them to make decisions about there money. They do all this with blinkers on as they can't see the wood for the trees, and that's what the industry is keen to maintain in order to keep the bankrupt system afloat as long as possible.

 

The media and government in conjunction will do their utmost to keep the severity of the situation under the surface for as long as possible, in order to avoid the collapse of the golden goose and then watch the economy unravel rapidly afterwards.

 

Take a single big bank in the UK for an example for a moment say RBS, IF that collapsed and all the people and company's that had money in it were suddenly unable to access their money or it had actually disappeared what would happen? The whole UK and island would shut down, lots of people unable to pay their bills or buy food etc etc.

 

Do you really think this will happen?

 

I don't think it will happen as RBS is the world's biggest company by way of balance sheet assets. It is quite literally too big to fail. However it is also the most exposed in terms of derivative exposure to the global markets, so if we had a sovereign default i.e Greece or Italy then I think we'd see an extended bank holiday across the board in the UK while they tried to recapitalise them all at the same time.

 

In my view I think the most likely scenario would be the Argentina example back in the 90's when the country declared a state of national emergency, froze the banks and limited withdrawals to minor amounts. It also unpegged it's currency from the dollar and encountered massive hyperinflation, the result was that people's wealth was worth about 1/10 of what it was before the crash, wiping out all the middle class in one hit and forcing the poor into destitution. Anyone who foresaw the crash coming opted to take any wealth they had out of the banks and either stashed it, converted it into dollars or bought tangible assets with it pronto, meaning they could feed their family for the initial period of chaos that ensued, and they could also sell it for a huge profit when the upturn took effect.

 

One big point of note is that Argentina had the rest of the world to trade their way out of the mess with, this time around with the whole world in depression, it won't be anywhere near as easy.

[manxy]

Not being an analyst or such like, I've been looking at different information around the world.

Basically, there's a number of banks (mainly UK, although some major players in US) who've crossed the line and are now dealing in debt or stealing of their customers funds

(see businessinsider.com, Fitch, Zerohedge, Huffingtompost and many others)

There appears to be a lot of fraudulent reports running about the place and although I'm only a complete novice at this. If I had money in the following banks, then I'd consider removing them from such companies (No comment as to how I've done this, but it did take me a while) - JP Morgan, NF Global, BNP Parisbas , Bank of America, Barclays, Goldman Sachs, Credit Suisse, HSBC and also Deutsche Bank.

My workings out using the information on the web isn't what I call a safe bet and the likelihood of me being wrong is probably high, but do check them out if you have monies invested in these firms.

ps; please don't ask me for details but do the research yourself as my knowledge is limited.

pps; I had little knowledge preceding my inquiries and there's a few of these banks that I hadn't heard of before.

 

Edit: also check out Max Keiser

[Lxxx]

Not being an analyst or such like, I've been looking at different information around the world.

Basically, there's a number of banks (mainly UK, although some major players in US) who've crossed the line and are now dealing in debt or stealing of their customers funds

(see businessinsider.com, Fitch, Zerohedge, Huffingtompost and many others)

There appears to be a lot of fraudulent reports running about the place and although I'm only a complete novice at this. If I had money in the following banks, then I'd consider removing them from such companies (No comment as to how I've done this, but it did take me a while) - JP Morgan, NF Global, BNP Parisbas , Bank of America, Barclays, Goldman Sachs, Credit Suisse, HSBC and also Deutsche Bank.

My workings out using the information on the web isn't what I call a safe bet and the likelihood of me being wrong is probably high, but do check them out if you have monies invested in these firms.

ps; please don't ask me for details but do the research yourself as my knowledge is limited.

pps; I had little knowledge preceding my inquiries and there's a few of these banks that I hadn't heard of before.

 

Edit: also check out Max Keiser

 

I'd concur with most of that assessment. I do tend to follow this on a regular basis and have done for years and I'd add that they all have derivative exposure to each other and all have a certain degree of counter party risk interlinked with each others balance sheet liabilities. For example if JP Morgan ON IT'S OWN went down it would take the whole global financial system down with it, such is it's derivative liability. However as it is the de facto financial arm of the US Treasury then it WILL NOT go down, neither will Goldman Sachs as they are the two vehicles the financial elite are using to usurp national sovereignties and effectively buy countries outright.

 

The only way around it would be to declare the whole off balance sheet derivative market fraudulent and effectively worthless (for anyone who wants to see how cuckoo this whole system has got research both 'derivatives' and 'credit default swaps').

 

Also anyone who wants to learn more about whose brainchild these weapons of mass financial destruction are then look into the late Christopher Story's work, who was making great headway (and uncovering some uncomfortable truths) into it before he was murdere....sorry fell ill suddenly and died last year.

[manshimajin]

I don't think it will happen as RBS is the world's biggest company by way of balance sheet assets. It is quite literally too big to fail.

Lxxx RBS already failed! It had to be rescued from total collapse by a massive injection of taxpayer funds and is still only worth about 3% (last time I looked) of its peak value.

 

If you were to say 'RBS is too big to be allowed to fail' it might be more accurate. This is certainly what happened when it failed - money was injected to stop this from happening. However the question remains where would the UK Government get the money from to rescue RBS a second time? One helluva printing job.

 

It is certainly one bank with whom I would be very careful as to how much I deposited and would make sure that my deposits with them were not greater than my liabilities to them.

[Mutley]

What if the EU foes ahead and introduces the financial tax they've been mooting? Surely banks in Dublin and Lux will be looking to stay in the Europe timezone but avoid the tax? Potential for growth in IOM and Channel Isles?

[Lxxx]

I don't think it will happen as RBS is the world's biggest company by way of balance sheet assets. It is quite literally too big to fail.

Lxxx RBS already failed! It had to be rescued from total collapse by a massive injection of taxpayer funds and is still only worth about 3% (last time I looked) of its peak value.

 

If you were to say 'RBS is too big to be allowed to fail' it might be more accurate. This is certainly what happened when it failed - money was injected to stop this from happening. However the question remains where would the UK Government get the money from to rescue RBS a second time? One helluva printing job.

 

It is certainly one bank with whom I would be very careful as to how much I deposited and would make sure that my deposits with them were not greater than my liabilities to them.

 

Apologies, got my wording wrong. True, although you could say that about most banks, Dexia passed the stress test with flying colours in Belgium just months before it went bust. The public will be the last to know about any problems with individual banks for fear of causing a bank run i.e. Northern Rock. The whole system is dead, it's being kept alive on a life support machine of freshly printed cash, but you cannot print money indefinitely, and don't forget every new pound that is created is another pound on the national debt, so we're getting deeper into the mire every day. It's a mathematical certainty (IMO) that we'll hit the wall, the only question is when.

[Evil Goblin]

If one or two of the major banks go under then the veritable cat's cradle of relationships will tip all of them over. As the major banks are systemically vital the respective governments will step in and bail them out, printing as much cash as necessary. So, you'll still get your nominal amount of cash back but in terms of purchasing power it will be worth much less.

[Lxxx]

If one or two of the major banks go under then the veritable cat's cradle of relationships will tip all of them over. As the major banks are systemically vital the respective governments will step in and bail them out, printing as much cash as necessary. So, you'll still get your nominal amount of cash back but in terms of purchasing power it will be worth much less.

 

Very true. That's why anyone who has large sums of money sat around in a bank account it either a fool or stupid. It's no coincidence that people like George Soros are cashing in there stocks and buying farmland all across America. Now is the time to be buying tangible assets, if you are in a fortunate position to be able to do so. Digital wealth won't be worth the paper it's not even written on soon.