Posts filed under “Bailouts”
Great graphic depicting the size of various bailouts around the globe, from 2007-08:
click for ginormous graphic
"Barely a week after Europeans rebuffed American pleas to join in their bailout of the banking system, Europe now faces a financial crisis almost as grave as that in the United States — demonstrating how swiftly this contagion is spreading around the world.
In the last two days, governments from London to Berlin have seized or bailed out five faltering banks. In Ireland, where rumors of panicked withdrawals from banks spooked the stock market, the government has offered a two-year blanket guarantee on all deposits and bank debt.
Asia has been less buffeted by the turmoil, though a brief run on a bank in Hong Kong last week brought back dark memories of June 1997, when speculation against the Thai currency sparked a financial crisis that fanned rapidly across Asia, and later to Brazil and Russia.
Economists see a parallel between these two crises a decade apart: once creditors panic and begin to pull out their holdings, the underlying health of banks — or entire countries — no longer matters a great deal. In a global financial system, national borders are porous."
The U.S. Financial Crisis Is Spreading to Europe
NYT, September 30, 2008
In 1999 Congress passed the Financial Modernization Act, which allowed banks, insurance companies and investment houses to merge. Many experts point to it as one of the causes of our current financial crisis. At the time, Byron Dorgan was one of the few senators to speak out strongly against the legislation. Looking back, his predictions in 1999 seem prophetic and, looking forward, his views raise more questions about the $700 billion bailout plan.
Video after the jump
Byron Dorgan’s Crystal Ball
American News Project, Oct 01, 2008