i wasn't aware that the uptick rule put hundreds of billions of bad investments on these companies books. As for m2m how could they possibly suspend it, so these companies can start hiding bad bets on there books again? thats how this hole thing got started. If they do suspend it they should have that apply to evreyone here too. My account might look better if i can make up my own prices
Here is a better idea tell us what the assets are. Tell us what the banks net exposure is. Tell us who holds what and let us pick the winners. It is to late for a M2M repeal. Uptick rule is an excuse for the bagholder.
My guess, maybe instead of an M2M suspension, or sometime after its false hope subsides if it is employed... One Friday afternoon, when we're all watching for the usual FDIC Friday bank closures, the mother of all such announcements will hit the wire - major bank(s) nationalized. They keep putting it off, but things aren't getting better.
In such a scenario do all depositholders loose their money globally? A worldwide loss of all bank deposits would really mark the end of the world as we know it. I can subscribe to the view as to let them go bust if they are beyond repair but I have dificulty in seeing how the world could not find itself in some kind of nuclear WWIII overnight. It's tempting to believe propping them up will save the day.
This is my major worry. Are the problems at the banks big enought to effectivly wipe everything out and is that why the government is not doing something more concrete to stabilize the market due to it being too big even for them to handle. It is not the the CDO's that worry me it is the CDS on them and other debts that does. That is why I want to know the net. The governments need to do something soon or it will not matter the lack of funding in the market will just continue and the negitive spiral will go on. This will just make the losses larger for the banks and wipe out most of the global insurance industry and many others (GE?). I still belive that there will be winners if we get full disclosure but after 18 months information and clarity has been so poor.
The thing is, the biggest American banks and financial institutions are systemic in a global way and that's the catch here. Letting "the Free market" work would catapult the US and it's citizens into a status of parasites around the world for decades to come. Some might argue that's already the case so why care, right? Despite higher leverage and more risk overseas this financial crisis is primarely viewed as a crisis originated in the US.