Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
Display:
Yes, intervention by the Fed (not by the ECB, but through the ECB, for practical reasons) to save their part of the system.

Wind power
by Jerome a Paris (etg@eurotrib.com) on Sat Mar 17th, 2012 at 07:22:57 PM EST
[ Parent ]
The ECB was not doing their job. What American institutions were being saved, when it was the French banks that had the liquidity problems? Who was rescued from the impending doom of missing payments on USD interest rate swaps?

There are three stories about the euro crisis: the Republican story, the German story, and the truth. -- Paul Krugman
by Carrie (migeru at eurotrib dot com) on Sat Mar 17th, 2012 at 07:26:44 PM EST
[ Parent ]
The US money markets were rescued.

Wind power
by Jerome a Paris (etg@eurotrib.com) on Sat Mar 17th, 2012 at 07:29:40 PM EST
[ Parent ]
So, no wrong was going to befall any French institutions after defaulting on their dollar obligations?

There are three stories about the euro crisis: the Republican story, the German story, and the truth. -- Paul Krugman
by Carrie (migeru at eurotrib dot com) on Sat Mar 17th, 2012 at 07:33:41 PM EST
[ Parent ]
why the fuck do you keep on putting in my mouth things I haven't said?

Of course they'd be in deep shit, as in officially bankrupt, but then there's nothing preventing their regulator from taking them over and letting creditors live with that - especially foreign creditors in a foreign currency (they'd probably get access to the USD portfolio, which are probably decently sound, and that would actually be settled relatively easily). The  euro-side bankruptcy would be a good thing, by forcing the dezombiefication of the bank, but that would make the wrong people unhappy - again, less of a problem for France, which could nationalize the local bits and just let the international stuff become a bad bank, à la Dexia (where Belgium took back the retail/local bank), but without the state guarantees.


Wind power

by Jerome a Paris (etg@eurotrib.com) on Sat Mar 17th, 2012 at 07:44:07 PM EST
[ Parent ]
Because you keep pretending it was just the US that had a problem here. It was the Europeans who were rescued from default.

There are three stories about the euro crisis: the Republican story, the German story, and the truth. -- Paul Krugman
by Carrie (migeru at eurotrib dot com) on Sat Mar 17th, 2012 at 07:46:55 PM EST
[ Parent ]

Display:

Occasional Series