Financial Armageddon!!

[Ethtre]

Yep - that's how I read it (but then what do i know )

On the topic of Armageddon - I'm hearing lots of people freaking out about AIG being downgraded? Is there any significance in this in relation to NZ? (can you tell I'm a newbie ) It's all very interesting but I'm only *just* grasping what's actually going on except that it's really bad

[Ethtre]

On CNBC they've just said ANZ have confirmed $120US exposure to Lehmans

[OllyN]

Question

Has the ANZ/NAB lent to any of the other banks on the creditors list and now have double exposure?

[k1w1]

I would doubt that kind of double-indirection counts, Olly, unless the other organisation on the list also went tits-up.

[essence]

Washington Mutual is being watched very carefully, as well as Goldman Sachs and Morgan Stanley.

We're now seeing some very old and established companies go to the wall.

From a very reputable source, i was told that if we think we're not going to be affected, we're dreaming.

It may take a while 3-6 months, but there is no way we will get out of this without damage.

[Austrokiwi]

even if there were a slight possibility that NZ banks escape ( given the known exposure that won't happen) The ability to borrow money will be reduced further, I would anticipate Obtaining mortgage finance has just become harder!

[donna]

What other obvious challenges should we expect and if the likes of AIG, Goldman Sachs. Morgan Stanley go to the wall too - just how bad can it get here? Or are these questions ridiculous as the worst can not be known or predicted?

Cheers,

Donna

[Orkibi]

there is no way we will get out of this without damage

are you suggesting that ANZ NBNZ ,BNZ ,ASB, Wespac are in danger?

[k1w1]

It's common knowledge that ANZ and BNZ are the worst hit, but still not what you'd call "in danger" at the moment. WPAC and ASB are a lot healthier, as far as I know.

[Orkibi]

Any of the bank mentioned are owned by the Australian government?

[Matt Gilligan]

Kiwibank Raise Most of Their Cash Locally

Kiwibank Raise Most of Their Cash Locally

They must be better positioned, together with banks like TSB and SBS that get their cash in NZ from local capital raising.

Does anyone have the stats on which banks raise what locally v offshore ? Would be interesting to know the split, by banker, cos wholesales rates ex wall street must come under pressure with each institution going to the wall and reducing liquidity.

[Dean@Massiveaction]

The Aussie and kiwi banks exposure is peanuts really, hardly time to push the panic button here. Citibank, now that's a big number!!

[Paul34]

Poomba: I'm surprised that you haven't said that this was predicted in the book of revelations

The reality is that the world ticks on. EVERYONE saw this coming a long time ago. Look at sites like Daily Reckoning and you will see how people not caught up in all this think. This will sort out the money system in a new way with some pain but society will progress.

Govts do not let things crumble and their job is to make it tick on. They will do that by whatever way they can (lower rates, bail out banks, create a new govt dept! etc.). People will still need houses and still need to borrow to get it. People will only sell if they have to. Most of the population of the Western world are not effected. They go to work, have a house and never understood how all this worked. Life will change but it is far from armagedon.

[Tucker]

Agree Paul. A lot of analysts have said NZ isn't as bad as the rest as was shown by the drop in our markets compared to others. They went on to say we are a lot further through the cycle than a lot of other countries having already had a couple of negative quarters. They even thought we are closer to the end/bottom than we think before things level off/pick up.

The RBNZ indicated they wanted more of a drop in interest rates than what we got and may look at dropping another 0.50% to help try and push them through.

[dandan]

The RBNZ indicated they wanted more of a drop in interest rates than what we got and may look at dropping another 0.50% to help try and push them through.

That was pre Financial Armageddon.