Big Busted Bridges

For some reason these headlines make me think that we will see more pain in the banking sector as more mammoth buyout deals come to market (discussed here):

Banks Postpone Chrysler Funding Plan & KKR’s Banks Fail to Sell $10 Billion of Boots Loans

But maybe I am just too pessimistic and instead Moody’s is right to keep an optimistic take on all of this: US housing difficulties cause for concern but no systemic threat: Moody’s

According to Moody’s “The shock-absorption capacity of the ‘core’ of the financial system is very high.”

They point straight at the same banks who are now stuck with these massive bridge loans on their balance sheets for proof of that observation.

Shock absorbers are cool.

Leave a Reply

Your email address will not be published. Required fields are marked *