Thursday, Jul 16, 2009
One of the biggest lenders to American businesses (CIT) could go bust
MoneyWeek: This 'unknown' big bank could now go bust - making the US recession worse
CIT, One of America's biggest lenders, may go bust. If it does, it would be the fourth-biggest bankruptcy in US history. That would deepen America's recession - and hit the UK too
Posted by damien @ 01:14 PM (1156 views) Add Comment
10 Comments
- If you do not have an admin password leave the password field blank.
- If you would like to request a password allowing you to add comments and blog news articles without needing each one approved manually, send an e-mail to the webmaster.
- Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
- Please note that any viewpoints published here as comments are user's views and not the views of HousePriceCrash.co.uk.
- Please adhere to the Guidelines
1. flashman said...
This bank should be allowed to fail. It lends to US retailers and small businesses that deal with the consumer. The American public is spending less and will continue to do so. It therefore makes sense to shrink the retail sector and to shrink the banking sector that supplies it. What is the point of propping up a bank whose business model belongs to an era of ever-growing consumer spending? It'll swallow up the money and need it again and again
2. fubar said...
Making it the perfect candidate for a bailout.
3. inbreda said...
very true fubar. But really they need an executive in Mr Paulsons position to make that happen.
Like GS did.
Very bad planning on CITs part if you ask me.
4. alan said...
Reuters - latest - "Bailout talks with Govt failed".
"CIT's problems mushroomed two years ago in the wake of Chief Executive Jeffrey Peek's decision earlier this decade to expand into subprime mortgages and student loans, both potentially highly profitable but fraught with added risk. Peek's status at CIT remains uncertain. The company was not available for further immediate comment. CIT sought new help even after winning bank holding company status in December so it could draw $2.33 billion of taxpayer money from the government's Troubled Asset Relief Program".
5. General Congreve said...
BAILOUT!!! BAILOUT!!! BAILOUT!!!
Come on US treasury, print and bailout, I want to see the dollar wrecked good and proper, so my gold investment really pays out big.
6. p. doff said...
General..I don't understand your logic there. Surely you would just be exchanging your gold investment for a larger quantity of dollars - but if the dollar was 'wrecked good and proper' they would worth less, so where's the gain? You might just as well leave your cash in any currency that you think will hold it's own, cop some interest on it, and then simply exchange the cash for even more dollars if they are wrecked.
7. devo said...
Didn't CIT pass the 'stress test' a couple of months ago?
8. Ndg said...
CIT failed their "stress test" on July 14th 2009.
They failed as a result of being "too small to survive" i.e. their demise will not cause a further systemic failure of the financial system.
Make of that what you will. Oh and by the way; Nice one flashman, you seem to have the situation well evaluated. Not.
9. Ndg said...
Gold will be imminently more useful for barter when paper money is finally reduced to toilet paper. Likewise silver. Probably coins and coloured beads too.
Unless, maybe like flashman, you prefer the option to "manage" your financial matters by way of an RFID chip.
These are the options. I'm not with flashman.
10. This comment has been removed as it was found to be in breach of our Blog Policies.