Financial Armageddon!!

[roseneath_rat]

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.

They vary from a low of 25% up to a high of around 25% with the most exposed being ANZ & ASB. Liquidity premiums have been rising, the effective increases in funds to the big four have been around 100-130pts, which has had a direct flow-on effect to wholesale borrowers over the last year of approx 0.20-0.30%.

[Tucker]

That was pre Financial Armageddon.

It was said even more so now.

[dandan]

It was said even more so now.

So you see more than a 0.5% drop?

[Tucker]

Yes looking at it, it may be bigger than 0.50% and sooner. Initially it was going to be a 0.50% drop because of what's happened but some have said it may be more

[Commercial Dan]

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.

Spot on, Kiwibank is where I have parked my cash as will be safe.

Don't let the figures of ANZ/BNZ fool you with regard to Lehman, this crisis goes deeper than that and most banks have no idea where half of these subprime mortgages are hiding.

[dandan]

Yes looking at it, it may be bigger than 0.50% and sooner. Initially it was going to be a 0.50% drop because of what's happened but some have said it may be more

And because of the Freddy and Fannie issues before the last OCR drop it had to be a 0.5% drop instead of 0.25%?

[roseneath_rat]

CD, may I remind you that Kiwibank of has a lower S&P credit rating of AA- than the main aussie owned banks at AA? Your money would be safer with Rabobank, they have a better rating than the NZ Government.

[Davo36]

These ratings seem to mean nothing. Quite highly rated institutions have gone under.

Also, I found out today that the Public Trust has term deposits etc. and they are government guaranteed - they are a crown owned entity.

I think KiwiBank is pretty safe albeit not government guaranteed. And yes RaboBank is huge and AAA rating - for what it's worth.

David

[Badger]

As I have posted a few times its all about the avalibilty of credit when it comes the housing -merry -go round of the past say 10 years at least.

With out credit people dont get loans but you can only debt so many people up for some of the time before you run out of people that can no longer assume more debt any of the time especially based on some faulty assumption on the never ending capital game idea

The fall out from the states will probably reasult in the FED printing money to plug the gaps this I think but am not 100% sure means they export there inflation to the rest of us as they have been over the past 30 years

Its a bit over my knowledge base but im reasonably sure things works along those lines according to what I have been reading about hegemony of the USD...

[Commercial Dan]

CD, may I remind you that Kiwibank of has a lower S&P credit rating of AA- than the main aussie owned banks at AA? Your money would be safer with Rabobank, they have a better rating than the NZ Government.

I have some in Rabo as well.

[TonyMacaroni]

CD, may I remind you that Kiwibank of has a lower S&P credit rating of AA- than the main aussie owned banks at AA? Your money would be safer with Rabobank, they have a better rating than the NZ Government.

Yeap, those credit ratings sure have been useful up until now... Never get cut until bankruptcy gets announced over the weekend and it's too late to get the money out.

I'd back the NZ taxpayer to bail me out through Kiwibank more than a fully private Australian bank. Best to spread it around a bit though, as CD suggests.

[tpr2]

Hi guys
Just a thought.....I know a couple of you have really hammered the inflation point of view and this makes me beg the question "why put all your money into cash?"

Surely, somewhere, some place sometime you see an asset class or perhaps individual assets within those asset classes potential for capital growth.

I ask this because I for example as an ex tax resident of Australia used to pay 48.5% in every dollar I earnt from investments due to my income.

So lets say Rabo paid me 8.5%, nearly half of that is taken is tax. Inflation running at high 3's then eroded the rest of that and if Steve netwriter's posts from chris (forgot his last name) are accurate then the real rate of inflation is way higher and my ROI is destroyed by inflation in real terms and tax.

Just a thought. I am sure you guys will have great answers for me to ponder.

[dandan]

Good question Tpr2, I think property is the best place to put your money.

[tpr2]

corr.... Those are some pretty big numbers. I'm impressed with the names like Denis Graham $100,000,000.
I am pretty sure those guys will be cra##ig them selves. The boss won't be happy.

[tpr2]

Good question Tpr2, I think property is the best place to put your money.

Thats always been my opinion dandan. At least as a vehicle for storing your wealth and as a vehicle for creating it. I do believe, especially in Oz where there are some pretty good incentives for using annuities in retirement that property becomes less attractive in retirement.