This last post made me smile because it is exactly what is going on in the banks at the moment.
The banks in that particular "story" agreed to the write off verbally. They won't confirm it in writing and their solution is to leave the "outstanding balance" sitting in an account for the next six years with a promise that they will never call it in.
The banks are playing for time, kicking the can down the road six years, hoping that when they have to eventually realise the bad debt in their books, that times will be better and they will have more capacity to be able to deal with it better at that stage.
The facts remain. There are lots of rotten loans in the banks, that are being hidden from the regulators, from the government and from the public.Its a survival game and it will continue if we let it.
Is anybody really convinced that the banks have properly provided for impaired loans in their books. There's not a chance in hell that they have. Very very worrying. The sooner that the whole sorry mess is flushed out and the banks are properly recapitalized, the better it will be for all of us.
The banks in that particular "story" agreed to the write off verbally. They won't confirm it in writing and their solution is to leave the "outstanding balance" sitting in an account for the next six years with a promise that they will never call it in.
The banks are playing for time, kicking the can down the road six years, hoping that when they have to eventually realise the bad debt in their books, that times will be better and they will have more capacity to be able to deal with it better at that stage.
The facts remain. There are lots of rotten loans in the banks, that are being hidden from the regulators, from the government and from the public.Its a survival game and it will continue if we let it.
Is anybody really convinced that the banks have properly provided for impaired loans in their books. There's not a chance in hell that they have. Very very worrying. The sooner that the whole sorry mess is flushed out and the banks are properly recapitalized, the better it will be for all of us.