Well, Anorak’s efforts to lead-manage our plan to cheer up the Germans may be too little, too late, but at least we’ve found some more of those Weapons of Mass Financial Destruction; it turns out that the Hypo Bailout Mark 1 sank on the discovery by the commercial banks who were supposed to be funding it that Hypo needed vastly more money than it had admitted to.
Nope, it wasn’t just lending money on garbage to people with no means to repay it, leaving it with a $35 billion hole in its balance sheet, it had issued guarantees to back American municipal bonds that it had sold to investors.
As they always say, the devil is in the details, and these details run to $15 billion owing on those guarantees.
Traditionally the next step is to invade Poland.
The way things are going we may have to upgrade our recommendation from ’sell’ to ‘run for your lives’…
- Chenier
Posted: 6th, October 2008 | In: Money, Twitterings Comments (10) | Follow the Comments on our RSS feed: RSS 2.0 | TrackBack | Permalink
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October 6th, 2008 at 9:45 pm
I think that was more in the nature of turning mighty oaks into little acorns, but it certainly was billed as the stepping stone to a prosperous and wealthy nation and it turned out to be the lead in to what Alan Greenspan has had to admit is the sort of financial crisis which hits once in a hundred years.
Possibly there was somebody standing on a roof, on one foot, with a bow and lucky arrow aimed at a dragon’s undercarriage in a parallel universe and it turned us into the wrong trouser leg of time…
October 6th, 2008 at 9:09 pm
I’m loathe to go back to the Miners strike, but from little acorns……………
October 6th, 2008 at 9:02 pm
Thank you, Saul; I rely on you to lift my spirits as I plod through the rubble of a once proud economy which used, as I recall, to actually make things.
Have you noticed the total silence from all those people who assured us that destroying our industries was a necessary step to the Nirvana of wealth creation?
How come the Times Headline is
‘Global panic on markets as US bailout fails to stem credit crisis’
when it was blindingly obvious that a trillion wouldn’t hack it weeks ago?
If we could see it why couldn’t they?
Answers on a postcard, please….
October 6th, 2008 at 8:44 pm
Kerry Katona?
October 6th, 2008 at 8:37 pm
Well, it looks like no-one asked him about our money, at least according to the WSJ blog, and he lives to moan another day; meanwhile, back on our side of the pond, Iceland is selling off its foreign holdings and sending it all back home.
At least it has some foreign holdings to sell…
October 6th, 2008 at 8:07 pm
Difficult to know what the Sub Comittee did to deserve him; has anyone asked him about our $8 billion yet?
October 6th, 2008 at 7:44 pm
The marvels of interactive TV mean that I am currently watching Dick Fuld facing a Sub Comitee.
October 6th, 2008 at 7:39 pm
Fear not; I am currently drafting a quick piece on ‘That Old Black Tax Magic’ which might allow a banana or two to be shipped to the gorilla, thus saving the world.
Again…
October 6th, 2008 at 7:23 pm
Looks like the “Gorilla” is atop the Empire State Building, and about to be shot down.
October 6th, 2008 at 7:16 pm
I am sorry to say that the situation is even worse than I described earlier; that should be 15 billion Euros, not dollars.
Which turns the amounts guaranteed on the US Municipal Bonds that Hypo is in the hole for to $20 billion.
And the total bailout package for it to $67 billion…