Who can you believe?
On Oct. 6, bizjournals noted:
And on Friday, Sept. 26, a “silent run” began on Wachovia’s deposits, as borrowers drew down on lines of credit and depositors removed funds from their accounts, the suit states.
The company’s ability to borrow from other banks was also compromised as the price of credit-default swaps — the insurance products that lenders need to cover the risk of lending to Wachovia — began to soar.
But wait, also on Sept. 26, CNN Money was telling us:
Regardless, Wachovia looks to be in substantially better shape than Washington Mutual before WaMu failed. Wachovia has a loyal and largely affluent banking clientele, and a sizable business of offering investment services to clients through financial advisors. WaMu, by contrast, was a saving-and-loan, and had far fewer business lines.
What's more, Wachovia is hardly running out of capital, says Bush. [Nancy Bush, a bank analyst at NAB Research]
IPBiz notes that the CNN Money story has been sikahema'd (that is, removed from the internet). The relevant portion was preserved on IPBiz. See
http://ipbiz.blogspot.com/2008/09/wachovia-taken-over-by-citigroup-fear.html
**Separately, "credit default swaps" perform an insurance-like function but are NOT insurance, and are not regulated like insurance. The lead story on "60 Minutes" on Oct. 5, 2008 made this quite clear.
And on Friday, Sept. 26, a “silent run” began on Wachovia’s deposits, as borrowers drew down on lines of credit and depositors removed funds from their accounts, the suit states.
The company’s ability to borrow from other banks was also compromised as the price of credit-default swaps — the insurance products that lenders need to cover the risk of lending to Wachovia — began to soar.
But wait, also on Sept. 26, CNN Money was telling us:
Regardless, Wachovia looks to be in substantially better shape than Washington Mutual before WaMu failed. Wachovia has a loyal and largely affluent banking clientele, and a sizable business of offering investment services to clients through financial advisors. WaMu, by contrast, was a saving-and-loan, and had far fewer business lines.
What's more, Wachovia is hardly running out of capital, says Bush. [Nancy Bush, a bank analyst at NAB Research]
IPBiz notes that the CNN Money story has been sikahema'd (that is, removed from the internet). The relevant portion was preserved on IPBiz. See
http://ipbiz.blogspot.com/2008/09/wachovia-taken-over-by-citigroup-fear.html
**Separately, "credit default swaps" perform an insurance-like function but are NOT insurance, and are not regulated like insurance. The lead story on "60 Minutes" on Oct. 5, 2008 made this quite clear.
posted by Lawrence B. Ebert at 12:14 PM
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