The latest OECD Composite Leading Indicator shows the economic growth patterns for the member countries. It is quite a mixed bag with China up after being down, India down, Canada down, and many just stable. OECD Composite Leading Indicator Continue reading OECD composite leading indicators point to stable pace of expansion
Ron Shevlin, it is terrific how you simply capture my beliefs and this post went over the top by capturing two of them! The 2010 Marketing Tea Party Awards Twitter won’t ever succeed as an advertising channel. Bottom line is that Groupon was crazy for declining a $6 billion offer. Relevance to Bankwatch: Ron is dead on with both observations and they are connected. Social media is just that, social. Business whether it be banking or fish mongering is not social – it is business. Business introduces other aspects that go beyond personal, and involve budgets, brand consciousness, peer pressure … Continue reading The value of social is nowhere to be seen so far
This chart is from the US Federal Reserve – December 9, 2010 – Statistical Release – Z.1 Flow of Funds. http://www.federalreserve.gov/releases/z1/Current/z1.pdf.  What leaps off the page is that consumers knew something was wrong back in 2006. During that year households were already borrowing at a slightly slower rate yet it was not until Sept 2008 that Banks clued in following the Lehman Brothers bankruptcy. It is also interesting that businesses were borrowing more that same year, 2006. Anyhow even more dramatic is the net reduction in debt that began in Q1 2009, and continues. However the Q3 2010 number hints … Continue reading Consumer debt levels in the US offer clues to banks’ strategy
This is an interesting piece from DB Research looking at banks exposure to countries which in Europe is one of the root causes of the problem there. The first slide graphically displays the Irish problem. Remember Ireland guaranteed all banks and thus took on their exposure as sovereign debt. This decision taken in 2009 increased Irish sovereign exposure by an incredible 900%. But we knew that, The second slide was a surprise. It displays country bank exposure due to lack of diversification – banks keeping all their eggs in one basket. Canada leaps to the top here due to lending … Continue reading DB Research points the way to analyse bank cross border exposures
A Deloitte survey on the latest experiences in consumer lending. The biggest finding is that 11% have experienced a negative credit event for the first time in the last 2 years. The next chapter in consumer lending | Deloitte To determine the scale of the challenge facing the banks and to find out how consumers have been reacting to these developments, the Center for Financial Services sponsored a survey to sample a national sample of U.S. retail banking customers. According to our survey, many consumers are still dealing with the aftermath of the financial crisis and recession of 2007-2009. In … Continue reading Consumer lending evolution | Deloitte
After posting about the US borrowing landscape, I thought I would look at Canada. I was looking at the latest Bank of Canada statistics for Canadian chartered banks as a reference point. I compared the end of 2006, right before the banking crisis began to now. These numbers are interesting and display behavioural change amongst consumers and amongst bank marketing. Millions Nov 2006 Oct 2010 % increase Personal Loans $ 40,936 $ 53,400 30% Credit Cards $ 38, 627 $ 57,276 48% Lines of credit $ 123,310 $ 218,937 78% Mortgages $ 421,138 $ 500,217 19% Total $ 624,011 $ … Continue reading Canadian households are borrowing but many are saving too
A nicely written piece from Scott S. Powell, a visiting fellow at Stanford’s Hoover Institution, is a managing partner at RemingtonRand Corp. and Alpha Quest in the NY Post. It makes the reality of QE2 clear. This is not some subtle central bank maneuver. On the contrary it represents a gamble. The road to a US insolvency crisis | NY Post Today’s auction of 10- and 30-year US Treasury notes and bonds won’t tell us as much about the US economy as auctions used to — because the Federal Reserve has started buying up the notes as part of Fed … Continue reading QE2 and the gamble it represents for us all
There is a shift occurring in world economics in the wake of the credit crisis, and this move at Morgan Stanley sums it up. There is an assumption that there will be a sovereign debt default, and for now is it assumed it will come from the ‘peripherals’. Government bonds: A coinage debased | ft.com It was a small decision but the symbolism was huge. A few months before Ireland’s multibillion-euro bail-out, announced last week, Morgan Stanley quietly switched dealing in the country’s bonds, along with those of Greece, Portugal and Spain – together, the four “peripheral” countries often seen … Continue reading Morgan Stanley quietly move ‘peripheral sovereign debt’ to the collections department
I have picked up over the last 3 years, Citi interest in employing a new model. Of course every bank wrestles with the extremes of virtual bank versus optimised branches. The results has been boring so far. Maybe Citi has something here. We shall see. Citi looks to Europe retail revival | ft.com But, according to people close to the bank, Citiis determined to rebuild a slim network of flagship outlets – mimicking the store model employed by Apple, the technology group – to underpin an operation in key parts of western Europe. Technorati Tags: Citi,Citibank,Europe banking,online banking Continue reading Citi looks to Apple store model for branches in Europe
This resolution of the Irish situation is an unmitigated disaster. Lets consider what has happened here. Irish banks got greedy and took on enormous risk through external investments including US subprime mortgages. The Irish government chose to guarantee 100% of bank liabilities. That took the Irish debt /GDP from 60% to 176%. Ministers sign off on €85bn Ireland deal | ft.com About €50bn is aimed at bolstering Ireland’s public finances while it implements a €15bn austerity package over the next four years. Of the remaining €35bn, €10bn will be used to recapitalise Ireland’s stricken banks, while another €25bn will be … Continue reading The Irish bank bailout is a clarion call to allow “Too Big” to fail
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