Only a few were designed to survive. I made a rather crude model of the current trend to the virus rocking the financial sector.
I should state up front, I don't appreciate Canada and Great Britain placing their assets as risk to save a contemplated assault of the Bush White House. The stage was set by Georgie's folks and probably began with his first cabinet, but, in all honesty 'the timing' for the arrival of Hank Paulson is perfect.
The table is rather simple to follow. The financial institutions are listed from the NY Times multi-media article that connects when one clicks on the title to the entry.
If you click on the picture graph above it will enlarge for easy reading. Didn't care to put labels on the x and y axis, sorry, didn't think they were absolutely necessary, actually.
So, I suppose a splash of color would have been better, but, if you can't figure this simple illustration out when in black and white then you are a very sad soul indeed.
The numbers on the x-axis, that's the bottom if your moron content is high, match the financial insitutions in the column on the left, which are crudely abbreviated. Check the NY Times interactive if you need the complete names.
At any rate there are two bar graphs for each banking institution. One is the assets the institution had a year ago and the other is the PERCENTAGE of loss they have suffered until September 12, 2008.
You see, this was all very, very predictable. The financial institutions on the right of the graph are the onces with the lowest total 'worth' a year ago. All of them have been consumed by the 'Resiliency Virus' as it spread its wicked little 'Domino Effect' across the spectrum of failure. I honestly don't know where everyone has been looking but this is child's play actually. What concerns me more than anything is that our allies are getting involved as if its some kind of war.
IT ISN'T AT ALL A WAR, so much as a sovereignty issue and if there is not enough prudent maneuvers to protect themselves they will go where the USA is now, INSOLVENT. I mean you have to know that the USA dollar isn't worth the paper its printed on by now.
At any rate, here is the solution. Dear Gordon Brown and Steven Harper have a solution. Stop bailing out the USA to begin with. Vladimir might want to pay attention as well. The solution is simple. Ready?
The virus is designed to 'take out' the financial institutions that have the least assets. That doesn't mean they were poorly managed or deserved to be dissolved, it simply means they were the MOST VULNERABLE. So everyone can stop pointing figures at Bear Sterns thinking they are 'one up' on great management, 'CAUSE, you ain't. As a matter of fact, Bear Sterns is probably one of the best managed insitutions to hold out as long as it did, so some lessons in decision making can be learned from that Long Lived financial institution. But, I am sure I am boring everyone, so let's just get on with it.
Excluding Goldman Sachs, the best way to 'attack the Resiliency Virus' is to secure those institutions still in practice and I wouldn't be so quick to simply 'gobble up' insitutions like Merril or even Bear Sterns. Here is the deal.
The survivors are simply this, JP Morgan, Bank of America and Citibank have assets, but, it won't hold up without the backing of some solid sovereign authority and I AM NOT TALKING GOVERNMENT 'TAKE OVER.' What these 'survivors' need is to 'push back' against the trend. Ignore every other investment and make 'mega-institutions' out of the survivors. Literally, a battery of banks, uncontaminated by Bush/Paulson, that have the ability to absorb large investments through Government Loans to REINSTILL the less institutions already disaffected.
SORT OF LIKE 'BIG BROTHERS' if you can excuse the genderization of it all.
Basically, there was absolutely nothing wrong with the institutions that failed. What occured was manipulation of the Bush White House to destroy the USA's fiscal infrastructure to sink long standing institutions such as Social Security. It was purposeful and planned and no one should ever believe differently.
To maintain 'the integrity' of the fiscal institutions that will assist the others back on their feet, so to speak, is paramount to a good outcome. I strongly feel government take over of any of these institutions is plainly wrong. However, the 'reinfusion' of CONFIDENCE and plain old money into the surviving institutions to faciliate 'regrowth' of the fiscal sector will not only provide stability, but, also produce growth. Eventually. As these mega-banks reinfuse the financial sector it will be done prudently and purposefully and without government/political priorities. This is a sovereignty issue, because to fail is to be gobbled up by the Resiliency Virus and certain monetary demise. Not only that, but, it will certainly give Bin Laden a great deal of pride to say he was responsible when he had nothing to do with it. Who needs that kind of jihadist around the globe.
Now, look, these loans have nothing to do with government debt in the long run, because the financial sector is going to pay them back. It's just that time and patience and some tailor made solutions through a sensitive BUT WISE legislative process will be necessary. Government is very important in this process. The institutions will have to keep open and honest communication and audits available nearly continuously until all is resolved.
Now. This is doable and it will work. No national debt load in the long run means that a country can ask very low lending costs to these 'survivor' institutions with the understanding they will rebuild the lost infrastructure.
Goldman Sachs can take a hike and DON'T TRUST THEM to do the best thing for the best outcome.
Good luck, I'm watching !!!
