Summary
Implications: 1.Writediwns are forcing large Institutions to raise New Capital to Offset Losses and extend a Lack of Willingness to extend Credit! 2.Banks are marking their Securities against an index: A Possible outcome is that losses MayBe 32 times worse than actual performance. 3.Fallacious Indexes have created More Problems than are required. 4.Hugh Writedowns in the Value of Bank Assets have gone to far and are disruptive in nature. 5.The question at hand: " Does Market to the Market in the midst of Financial Turmoil provide a viable alternative"? 6.A Statement of fact: The vast majority of of Banking Institutions are , still, well-capitalized and can support the writedowns and other types of losses. 7.Is a Bail-out scenerio being created for the Industry?
Analysis
Commentary:
1.Institutions, still, seem to be facing enhanced Operational Risk and a worsening Financial Meltdown!
2.While some Institutions have adequate amounts of liquidity - No amounts of capital can prevent a prospect of illiquidity for a Financial Institution!
3.Larger Risk Concentrations are in existence and weaker management risk mitigation is ,still, a viable commodity for many.
4.The timing and extent of earnings recovery are facing a hugh amout of uncertaintity.
5.The Possibility of further Downgrades due to "Significant Exposure"will increase the Price of Interbank Lending.
6. A concept all would like to AVOID!!!!!
