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European Banks Facing Funding Squeeze Devour Record ECB Emergency Funding

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12/24/2011


European banks borrowed enough cash from the European Central Bank at its first three-year offering to refinance almost two-thirds of the debt they have maturing next year amid concern that markets will remain frozen. The 523 euro-area lenders took a record 489 billion euros ($638 billion) from the Frankfurt-based central bank in 1,134- day loans today, more than economists’ median estimate of 293 billion euros in a Bloomberg News survey. That equals about 63 percent of the European bank debt maturing in 2012, according to Goldman Sachs Group Inc. analysts.

         

 

The Justice Department on Wednesday announced the largest residential fair-lending settlement in history, saying that Bank of America had agreed to pay $335 million to settle allegations that its Countrywide Financial unit discriminated against black and Hispanic borrowers during the housing boom. A department investigation concluded that Countrywide loan officers and brokers charged higher fees and rates to more than 200,000 minority borrowers across the country than to white borrowers who posed the same credit risk. 

        

 

Momentum is defined as the tendency for investments that have performed relatively well in the recent past to continue to do so and for relatively poorly performing investments to continue to fare poorly. It is a well-documented anomaly in modern finance. Numerous academic studies have confirmed that, when measured in periods of approximately three to 12 months, past investment winners tend to keep on outperforming while past losers tend to keep underperforming.

       

And so the year ends not with a bang but with an economic whimper, as the final Q3 GDP is revised lower from 2.0% to 1.8% on expectations of an unchanged print. The reason: Personal Consumption contributed only 1.24% instead of the 1.63% in the second revision and 1.72% in the advance forecast. Net net - very weak report and one which portends weakness from Q3 is spilling over in Q4.

 

 

 

 

 

  

More Good Stuff:


Calculated Risk: Weekly Initial Unemployment Claims decline to 364,000

        

Final Q3 GDP Misses As Personal Consumption Drops Big | ZeroHedge

       

Harnessing the Power of Momentum

       

$335 Million Settlement on Countrywide Lending Bias - NYTimes.com

       

European Banks Devour ECB Emergency Funds - Bloomberg

       

A Look Back at 2011 - BlackRock Investment Management

       

HO-HO-HORROR! 42% Of Kids Under 5 Can't Identify Santa

          

Concussed, The Year in Review - Broadleaf Partners

        

18.3%…. | PRAGMATIC CAPITALISM

         

US Housing Market Was Artificially Inflated By 14% In 2007-2010 NAR Reports | ZeroHedge

        

What The Analysts Are Saying - Wall Street's Kneejerk Response To Oversized LTRO | ZeroHedge

       

  

  
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