The results of bank stress tests released this week, do not bear good news. The bottom line is that at total of $75 billion needs to be raised from 10 major banks to prop them up for losses that could come from a deepening recession.
Here is a Top 4 summary of who needs what in the next six months:
Bank of America (BAC) will have to raise $33.9 billion;
The question people are asking is whether this is the worst news yet? Or whether it is news that the worst is over?
There is no easy answer. The truth is that if unemployment continues to rise, housing prices continue to fall and the economy continues to shrink, then much more money might be needed as problem bank loans could be on the rise.
Climate scientists have long known that, pound for pound, methane is 20 times more powerful than carbon dioxide at trapping the suns rays, making it a highly potent greenhouse gas. An incredible 900 billion tonnes of the noxious fumes are produced each year by methanogen bacteria that live in the digestive systems of ruminants such as cattle, sheep and goats.
There’s nothing sustainable about the $700 billion Federal bailout plan for the decomposing financial sector of the US financial system. Americans know it, judging by the outpouring of objections sent to US legislators and reflected in national polls this past week.
According to various estimates by experts in the financial industry, the proposal to let the government buy bad assets from banks range from $500 billion to $1 trillion. Hank Paulson, Treasury Secretary, and Ben Bernanke, Fed Chairman, are asking for $700 billion – for now.
Keep in mind that this is ON TOP OF the costs already incurred for various government actions this year, including, but not limited to:
* up to $85 billion for AIG
* up to $29 billion to fund JPMorgan’s takeover of Bear Stearns
* up to $200 billion each for nationalization of Fannie Mae/Freddie Mac
* as much as $50 billion to insure money market funds
* up to $25 billion for special loans extended to GM and Ford
Let’s not forget the billions of dollars in expenses to help those in flooded or hurricane-destroyed areas – so recent that the costs aren’t even in for the damage done from Hurricane Gustav and Hurricane Ike. There’s plenty of other federal funds flowing to counties throughout the US that were declared federal disaster areas in 2008 – like in Vernon County, Wisconsin, where we own a silviculture operation.
