Today relax day...one interesting article about actual Global Economic Downturn explanation:
NINJA CRISIS 2007-201?
1. For years, interest rates in international financial markets have been exceptionally low. For years, interest rates in international financial markets have been exceptionally low.
2. This has meant that banks have seen that the business made them smaller: This has meant that banks have seen the business that made them smaller:
• They gave a low-interest loans They gave loans at low interest rates
• They paid something for the customer deposits (zero if the shell is in current accounts and, if also charged Maintenance Committee, paid "unless something") They paid something for the customer deposits (zero if the shell is in current accounts and, if also charged Maintenance Committee, paid "unless something")
• But, still, the intermediation margin ( "a" minus "b") decreased But still, the intermediation margin ( "a" minus "b") decreased
3. 3. Someone, then, in America, he decided that banks had to do two things: Someone, then, in America, I have decided that banks had to do two things:
• Give more risky loans, by which they can charge more interest Give more risky loans, by Which they can charge more interest
• compensate the lower margin by increasing the number of operations (1000 x bit is only 100 x bit) Compensate for the low margin by Increasing the number of operations (1000 x bit is only 100 x bit)
4. 4. As to the first (riskier loans), they decided: As to the first (riskier loans), they decided:
• Provide a type of mortgage customers, "ninja" (people without steady income, without fixed employment without property) Offer mortgages at a rate of clients, the "ninja" (people without steady income, without fixed employment without property)
• Charging more interest, because more risk Charging more interest Because there were more risk
• Use the real estate boom in the U.S. market had Harnessing the housing boom that was in the U.S. market
• In addition, full of enthusiasm, decided to grant mortgage loans worth more than the value of the house that he bought the ninja, because, in the aforementioned housing boom, the house in a few months, would be worth more than the amount given on loan. Moreover, full of enthusiasm, decided to grant mortgage loans worth more than the value of the house that I bought the ninja, because, in The aforementioned housing boom, the house in a few months, would be worth more than the amount given on loan .
• This type of mortgage, they were called "subprime" This type of mortgage, they were called "subprime"
• They are called "prime mortgages" which have little risk of default. They are called "prime mortgages" which have little risk of default. On a rating scale between 300 and 850 points, prime mortgages are worth 850 points between the best and 620 the least good. On a rating scale between 300 and 850 points, prime mortgages are worth 850 points between the best and 620 the least good.
• They are called "subprime" which have a higher risk of default and are priced between 620 and 300 the least good, the bad. They are called "subprime" which have a higher risk of default and are priced between 620 and 300 the least good, the bad.
• Furthermore, as the U.S. economy was going great, the insolvent debtor could find a job today and pay the debt without problems. Moreover, as the U.S. economy was going great, the insolvent debtor could find a job today and pay the debt without problems.
• This approach was well for some years. This approach was well for some years. In those years, the ninja were paying the mortgage installments and also as they had been given more money than their house was worth, had bought a car, had been renovating the house and had gone on holiday with family . In those years, the ninja were paying the mortgage installments and also as they had been given more money than their house was worth, had bought a car, had been renovating the house and had gone on holiday with family. This, surely, in installments, with the extra money they had charged and, in some cases, which were paid in a botched job or they had achieved. This, surely, in installments, with the extra money they had charged and, in some cases, Which were paid in a botched job or they had achieved.
5.Primer Comment: I think, so far, everything is clear and it is also clear that anyone with common sense, although not a financial expert may think that 5.Primer Comment: I think, so far, everything is clear and it is also clear that anyone with common sense, Although not a financial expert may think, if something fails, the thud could be important if something fails, the thud could be important. .
6. As for the second (increased number of operations): As for the second (increased number of operations):
• Like many banks were giving loans, they ran out of money. Like many banks were giving loans, they ran out of money. The solution was easy: go to foreign banks to lend them money, because something is globalization. The solution was easy: go to foreign banks to lend them money, Because something is globalization. With that, the money that I, this morning, I joined the Central Office Savings Bank of San Quirico de Safaja may be that afternoon in Illinois, because there's a bank to which my Savings Bank has lent my money to pay him a ninja. With that, the money that I, this morning, I joined the Central Office Savings Bank of San Quirico de Safaja may be that afternoon in Illinois, because there's a bank To which my Savings Bank has lent my money to pay him a ninja. Of course, Illinois does not know that the money comes from my people, and I know that my money would be deposited into an entity like myself Savings Bank, began to be at some risk. Of course, Illinois does not know that the money comes from my people, and I know that my money would be deposited into an entity like myself Savings Bank, began to be at some risk. Neither does the Director of the Office of my box, who knows, "and presumed" that works in a serious institution. Neither does the Director of the Office of my box, who knows, "and presumed" that works in a serious institution. Neither does the President of the Savings Bank, which is only known to have invested some money of its investors in a major U.S. bank. Neither does the President of the Savings Bank, Which is only known to have Invested some money of its investors in a major U.S. bank.
7. Second comment: globalization has its advantages but also disadvantages and its dangers Second comment: globalization has its advantages but also disadvantages and its dangers. . The people of San Quirico not know who is taking a risk in the U.S. and when he begins to read that there are subprime mortgages, thinks: "What do these crazy Americans!" The people of San Quirico not know who is taking a risk in the U.S. and when he begins to read that there are subprime mortgages, thinks: "What do these crazy Americans!"
8. Furthermore, it appears that there are "Basel Standards" Furthermore, it appears that there are "Basel Standards", which require banks worldwide that have a minimum capital in relation to their assets. , Which requires banks worldwide that have a minimum capital in relation to their assets. To oversimplify, the Balance Sheet of the Bank of Illinois is: To oversimplify, the Balance Sheet of the Bank of Illinois is:
ASSETS LIABILITIES ASSETS LIABILITIES
Money Money Box that other banks have lent Money Money Box that other banks have lent
Credits granted granted Capital Credits Capital
Reservations Reservations
TOTAL TOTAL X X X million million million million X
The Basel rules require that the capital of the Bank not less than a certain percentage of assets. The Basel rules require that the capital of the Bank not less than A Certain percentage of assets. So, whether the bank is borrowing money from other banks and giving lots of credit, the percentage of Assets Capital Bank for the low and does not comply with the Guidelines of Basel. So if the bank is borrowing money from other banks and giving lots of credit, the percentage of Assets Capital Bank for the low and does not Comply with the Guidelines of Basel.
9. You have to invent something new. You have to invent something new. And that again is called Securitization: the Bank of Illinois "bags"-prime mortgages and subprime-in packages that are called MBS (Mortgage Backed Securities, or obligations secured by mortgages). And that again is called Securitization: the Bank of Illinois "bags"-prime mortgages and subprime-in packages that are called MBS (Mortgage Backed Securities, or obligations secured by mortgages). So, where once had 1,000 mortgages "loose" within the Account "Credits granted, now has 10 packs of 100 mortgages each, in which there is everything, good (prime) and bad (subprime) and in the Lord's vineyard. So, where mortgages 1.000 Once Had "loose" within the Account "Credits granted, now has 10 packs of 100 mortgages each, In which there is everything, good (prime) and bad (subprime) and in the Lord's vineyard.
10. The Bank of Illinois quickly sold those 10 packages: The Bank of Illinois quickly sold those 10 packages:
• Where does the money he gets for these packages? Where does the money he gets for these packages? Goes to the Assets, to the account "cash", increasing, decreasing by the same amount the account "Loans granted", so that the proportion Capital / Loans granted improvement and Bank Balance meets Basel . Goes to the Assets, to the account "cash", increasing, decreasing by the same amount the account "Loans granted", so that the proportion Capital / Loans granted improvement and Bank Balance meets Basel.
• Who buys these packages and also buy them quickly so that the Bank of Illnois "clean" their balance immediately? Very good question! Illinois Bank creates affiliated entities, the conduits, which are not companies, but trusts or funds, and which therefore are not required to consolidate its accounts with the Bank's matrix. Very good question! Illinois Bank creates affiliated entities, the conduits, Which are not companies, but trusts or funds, Therefore And which are not required to consolidate its accounts with the Bank's matrix. That is, suddenly appear on the market two types of entities: That is, suddenly appear on the market two types of entities:
The Bank of Illinois, with a clean face, and the Chicago Trust Corporation (or whatever name you please put it) with the following Balance: The Bank of Illinois, with a clean face, and the Chicago Trust Corporation (or whatever name you please put it) with the following results:
ASSETS LIABILITIES ASSETS LIABILITIES
The 10 packages of mortgages Capital: what you pay for those packages The 10 packages of mortgages Capital: what you pay for those packages
11. Third comment: If any person working in the Savings Bank of San Quirico, from President to Director of the Bureau knew anything about this, he would seek another job quickly Third comment: If any person working in the Savings Bank of San Quirico, from President to Director of the Bureau knew anything about this, I would seek another job quickly. . Meanwhile, everyone speaks in Expansion of its international investments, of which you see that do not have the slightest idea. Meanwhile, everyone speaks in Expansion of its international investments, of which you see that do not have the Slightest idea.
12. 12. How are they financed the conduits? How are they financed the conduits? In other words, where do they get money to buy the Bank of Illinois mortgage packages? In other words, where do they get money to buy the Bank of Illinois mortgage packages? Multiple Sites: Multiple sites:
• By credit of other banks (Fourth Comment: The ball is getting bigger) Through credit from other banks (Fourth Comment: The ball is getting bigger)
• Employing the services of investment banks can sell the MBS to Investment Funds, Venture Capital Companies, Insurance, Financial, Mutual assets of a family, etc.. (Fifth comment: Fixed that danger is approaching us, not Spain, but to our family, because like, animated by the Director of the office of San Quirico, and I put my money into an investment fund) Employing the services of investment banks can sell the MBS to Investment Funds, Venture Capital Companies, Insurance Companies, Financial Companies in a family heritage, etc. (Fifth comment: Fixed that danger is approaching us, not to Spain but to our family, Because like, animated by the Director of the office of San Quirico, and I put my money into an investment fund)
• What happens is that to be "financially correct", the MBS conduits or had to be well qualified by the rating agencies that give ratings in terms of solvency. The ratings say, "This company, in this state, this organization may lend money without risk," or "beware of these other risks because you do not get paid." What happens is that to be "financially correct", the MBS conduits or had to be well qualified by the rating agencies that give ratings in terms of solvency. These ratings say, "This company, in this state, this organization may lend money without risk," or "beware of these other risks because you do not get paid."
RATING: Rating of a company or an institution, made by a specialized agency. RATING: Rating of a company or an institution, made by a specialized agency. In Spain, the lead agency in this field is Fitch Ratings. In Spain, the lead agency in this field is Fitch Ratings.
The levels are: The levels are:
AAA, the highest AAA, the highest
AA AA
A A
BBB BBB
BB BB
Others, but Others are very ill, but they are very bad
Overall: Overall:
A bank or big box usually has a rating of AA A bank or big box usually has a rating of AA
A medium or Savings Bank, a medium rating of AA or Savings Bank, a rating of A
• The rating agencies gave these ratings or were given other names, more sophisticated, but at the end, say the same: The rating agencies gave these ratings or were given other names, more sophisticated, but at the end, say the same :
Called: Investment grade MBS representing the prime mortgages, or those of least risk (be the AAA, AA and A), Mezzanine, the intermediate (I guess maybe the BBB and BB), Equity to bad, high risk, ie the subprime, that in this shed, are the protagonists. Called: representing the investment grade MBS prime mortgages, or those of least risk (be the AAA, AA and A), Mezzanine, the intermediate (I guess maybe the BBB and BB), Equity to bad, high risk, ie the subprime that in this shed, are the protagonists.
• Investment Banks placed easily the best (investment grade) to conservative investors, and low interest rates. Investment Banks Placed easily the best (investment grade) to conservative investors, and low interest rates.
• Other fund managers, venture capital companies, etc., more aggressive. Other fund managers, venture capital companies, etc.., More aggressive. sought to obtain, at all costs, higher returns, among other reasons because these men earning the year-end bonus depending on the profitability. sought to obtain, at all costs, higher returns, among other reasons Because these men earning the year-end bonus depending on the profitability.
• Problem: How to sell MBS of bad managers latter without being noticed too that are incurring excessive risk? Problem: How to sell MBS of bad managers latter without being noticed too that are incurring excessive risk?
• Sixth Review: The plot thickens and, of course, those of the Savings Bank of San Quirico continue making statements Expansion happily, talking about the good of the economy and Social Work are doing. Sixth Comment: The plot thickens and, of course, those of the Savings Bank of San Quirico Expansion happily continue making statements, talking about the good of the economy and Social Work are doing.
• managed investment banks, rating agencies of a reclassification (a re-rating, a word that does not exist, but it serves to understand) Managed investment banks, rating agencies of a reclassification (a re-rating, a word that does not exist, but it serves to understand)
• Re-rating is an invention to raise the rating of the bad MBS, which is structured to sections, which are called tranches, ordering, highest to lowest, the probability of default, and the commitment to prioritize payment to the least bad. The re-rating is an invention to raise the rating of the bad MBS, Which is structured to sections, Which are called tranches, ordering, highest to lowest, the probability of default, and the commitment to Prioritize payment to the least bad. That is: That is:
I buy a package of MBS, which tells me that the first three MBS are relatively good, the three seconds, very regular and the three others, frankly bad. I buy a package of MBS, Which tells me that the first three MBS are relatively good, the three seconds, very regular and the three others, frankly bad. This means that I have structured the package of MBS into three tranches: the relatively good, very regular and very bad. This means that I have structured the package of MBS into three tranches: the relatively good, very regular and very bad.
I pledge that if the tranche will not pay very bad (or as they say these gentlemen, if in the wrong section I incur default), but some of the tranche recovery very regular and much of the relatively good, everything will go to pay mortgages tranche relatively good, which automatically adds this tranche will be rated AAA. I pledge that if the tranche will not pay very bad (or as they say these gentlemen, if in the wrong section I incur default), but some of the tranche recovery very regular and much of the relatively good, everything will go to pay mortgages tranche relatively good, Which automatically adds this tranche will be rated AAA.
Seventh comment: in the "Comments IESE Economic Situation, January 2008, I've got most of what I'm saying, I call this" financial magic "Seventh comment: in the" Comments IESE Economic Situation, January 2008, I've got most of what I'm saying, I call this "financial magic"
• To finish rolling to San Quirico, arranged in these MBS tranches were renamed CDO (Collateralized Debt Obligations, Collateralized debt obligations), as they could have taken another exotic name. To finish rolling to San Quirico, arranged in these MBS tranches were renamed CDO (Collateralized Debt Obligations, Collateralized debt obligations), as they could have taken another exotic name.
Not content with this, the financial wizards created another important product: the CDS (Credit Default Swaps) In this case, the purchaser, who bought the CDO, assuming a risk of default by buying CDOs, charging interest. Not content with this, the financial wizards created another important product: the CDS (Credit Default Swaps) In this case, the purchaser, who bought the CDO, assuming a risk of default by buying CDOs, charging interest. So, I bought the CDO and said, "if it fails, I lose money. So, I bought the CDO and said, "if it fails, I lose money. If it fails, recovery plus interest." If it fails, recovery plus interest.
Continuing with the inventions created another instrument, the Synthetic CDO, which I failed to understand, but which gave a surprisingly high yield. Continuing with the inventions created another instrument, the Synthetic CDO, which i failed to understand, But which gave a surprisingly high yield.
Moreover, those who bought the Synthetic CDO through bank loans could buy very cheap. Moreover, those who bought the Synthetic CDO through bank loans could buy very cheap. The interest differential between these very cheap and high yields of Synthetic operation was extremely profitable. Interest The differential between these very cheap and high yields of Synthetic operation was extremely profitable.
13. At this point and hoping that ye are not lost too much, I recall something that you may be you have forgotten, given the complexity of the operations: At this point and that hoping that ye are not lost too much, I recall something that you may be you have forgotten, given the complexity of the operations, that everything is based on the ninjas pay their mortgages and that the U.S. housing market will continue to rise. everything is based on the ninjas pay their mortgages and that the U.S. housing market will continue to rise.
14. BUT: BUT:
• In early 2007, prices of U.S. homes plunged. In early 2007, prices of U.S. homes plunge.
• Many of the ninjas they realized they were paying for more home now worth and what has (or could not) continue to pay their mortgages. Many of the ninjas they realized they were paying for more home now worth and what has (or could not) continue to pay their mortgages.
• Automatically, nobody wanted to buy MBS, CDO, CDS, Synthetic CDOs and who already had failed to sell. Automatically, no one wanted to buy MBS, CDO, CDS, Synthetic CDOs and who had already failed to sell.
• All mounting sank and one day, the Director of the Office of San Quirico a neighbor called to say that good that the money was gone, or, at best, had lost 60% of its value. The entire assembly sank and one day, the Director of the Office of San Quirico a neighbor called to say that good that the money was gone, or, at best, had lost 60% of its asset.
• Eighth comment: Go now to explain to the neighboring San Quirico what the ninjas, the Bank of Illinois and the Chicago Trust Corporation. Eighth comment: Go now to explain to the neighboring San Quirico what the ninjas, the Bank of Illinois and the Chicago Trust Corporation. You can not be explained by several reasons: the most important, because nobody knows where that money. You can not be explained by several reasons: the most important, Because nobody knows where that money. And when I say nobody, I mean NOBODY. And when I say nobody, I mean NOBODY.
• But things go further. But things go further. Because no one-not-know the crap they have in banks that bought mortgage packages, and as anyone knows, the banks start to not trust each other. Because no one-not-know the crap they have in banks that bought mortgage packages, and as anyone knows, the banks start to not trust each other.
• As they trust when they need money and go to the interbank market, where banks lend each other money, or do not lend it or lend it expensive. As they trust when they need money and go to the interbank market, where banks lend each other money, or do not lend it or lend it expensive. The interest that banks lend money in the interbank Euribor (Europe Interbank Offered Rate, or interest rate offered on the interbank market in Europe), a rate which, as you see in the term of 3-month Euribor this Dictionary, has gone up (now beginning to fall.) The interest that banks lend money in the interbank Euribor (Europe Interbank Offered Rate, or interest rate offered on the interbank market in Europe), a rate Which, as you see in the term of 3-month Euribor this Dictionary, has gone up (now beginning to fall.)
• Therefore, the banks now have no money. Therefore, banks have no money now. Consequences: Consequences:
i. i. Noncredit noncredit
ii. ii. They do not give mortgages, so that Astroc, Renta Corporation, Colonial, etc., I begin to go terribly wrong. They do not give mortgages, so that Astroc, Renta Corporation, Colonial, etc., I begin to go terribly wrong. And shareholders who bought shares of these companies, they see that the prices of these companies are falling sharply. And shareholders who bought shares of these companies, they see that the prices of these companies are falling sharply.
iii. iii. The 12-month Euribor, which is the benchmark for mortgages has been rising, which makes the Spanish average, which is your mortgage, start to sweat to pay the monthly installments. The 12-month Euribor, Which is the benchmark for mortgages has been rising, Which makes the Spanish average, Which is your mortgage, start to sweat to pay the monthly installments.
iv. As the banks have no money, iv. As the banks have no money,
1. 1. They sell their holdings in companies They sell their holdings in companies
2. 2. They sell their buildings selling their buildings
3. 3. Metamos campaigning for money, offering better conditions Metamos campaigning for money, offering better conditions
v. v. As people begin to feel squeezed by the mortgage payment, unless the Court is English. As people begin to feel squeezed by the mortgage payment, unless the Court is español.
vi. vi. As the English Court notices, purchase unless the manufacturer of socks in Mataró, nor the ninja knew existed. As the Court Español notices, purchase unless the manufacturer of socks in Mataró, nor the ninja knew existed.
vii. vii. The sock manufacturer believes that sells less socks as he starts on the staff and fired a few. The sock manufacturer believes that sells less socks as he starts on the staff and fired a few.
viii. viii. And this is reflected in the unemployment rate, mainly in Mataró, where people start buying less in stores. And this is Reflected in the unemployment rate, mainly in Mataró, where people start buying less in stores.
15. 15. This is a dictionary of words. This is a dictionary of words. What happens is that the word "Crisis 2007-2008" is very serious. What happens is that the word "Crisis 2007-2008" is very serious. The title is misleading, considering that the crisis will end in 2008. The title is misleading, considering that the crisis will end in 2008. Now comes another question: "How long will this last? Now comes another question: "How long will this last?
16. 16. Well very good question, too. Well very good question, too. very difficult to answer, for several reasons: very difficult to answer, for several reasons:
• Because they remain unaware of the extent of the problem (the numbers vary from 100,000 to 500,000 million dollars) Because they remain unaware of the extent of the problem (the numbers vary from 100,000 to 500.000 million dollars)
• Because we do not know who is affected. We do not know if my bank, the lifelong, serious Bank and tradition in the area, has plenty of dirt on the Assets. Because no one knows who is affected. We do not know if my bank, the lifelong, serious Bank and tradition in the area, has plenty of dirt on the Assets. The trouble is that my bank does not know. The trouble is that my bank does not know.
• When, in America, mortgage defaults by the ninja are implemented, that is, banks can sell the houses mortgaged for the price it is, something will be worth the MBS, CDO, CDS and even Synthetic. When, in America, mortgage defaults are implemented by the ninja, that is, banks can sell the houses mortgaged for the price it is, something will be worth the MBS, CDO, CDS and even Synthetic.
• Meanwhile, nobody trusts anybody. Meanwhile, nobody trusts anybody.
17. 17. Ninth comment: Ninth comment:
• Someone has described this as "the great swindle" Someone has described this as "the great swindle"
• Others have said that the Crash of 29, compared to this, is a game of girls in the playground of a convent. Others have said that the Crash of 29, compared to this, is a game of girls in the playground of a convent.
• Quite a few, perhaps many, have been enriched with the bonus that had been gathering. Enough, perhaps many, have been enriched with the bonus that had been gathering. Now, will be jobless, but the bonus will be saved somewhere, perhaps in an armored closet, which may be where more secure and protected from other financial innovations that can happen to anyone. Now, will be jobless, but the bonus will be saved somewhere, perhaps in an armored closet, Which may be where more secure and protected from other financial innovations that can happen to anyone.
• The financial authorities have a major responsibility for what happened. The financial Authorities have a major responsibility for what happened. The Basel rules theoretically designed to control the system, stimulated the SECURITIZATION to extremes can obscure and complicate enormously the markets they are intended to protect. The Basel rules theoretically designed to control the system, stimulated the SECURITIZATION to extremes can obscure and complicate enormously the markets they are intended to protect.
• The Boards of Directors of financial institutions involved in this big fiasco, have a great responsibility, because they have not heard anything. The Boards of Directors of financial institutions involved in this big fiasco, have a great responsibility, Because they have not heard anything. And that included the Board of Directors of the Savings Bank of San Quirico. And that included the Board of Directors of the Savings Bank of San Quirico.
• Some rating agencies have been incompetent or independent from their clients, which is very serious Some rating agencies have been incompetent or independent from their clients, which is very serious
18. 18. End of story (for now): the major central banks (European Central Bank, the U.S. Federal Reserve) have been injecting liquidity to allow banks to have money End of story (for now): the major central banks (European Central Bank, the U.S. Federal Reserve) have been injecting liquidity to allow banks to have money. .
19. 19. Some experts say yes than no money, but what there is to confidence Some experts say yes than no money, but what there is to confidence. . That is, the liquidity crisis is not a real crisis of trust of others. That is, the liquidity crisis is not a real crisis of trust of others.
20. 20. Meanwhile, SWFs Meanwhile, SWFs, or investment funds created by states with resources from the surplus in their accounts (mostly from oil and gas), Ie investment funds created by states with resources from the surplus in their accounts (mostly from oil and gas) and the Funds of the United Arab Asian countries, Russia, etc.., they are buying major stakes in American banks to get them out of jams that have gotten Funds like the Arab Emirates, Asia, Russia, etc. .., they are buying major stakes in American banks to get them out of jams that have gotten. .
NINJA CRISIS 2007-201?
1. 1. Durante años, los tipos de interés vigentes en los mercados financieros internacionales han sido excepcionalmente bajos. For years, interest rates in international financial markets have been exceptionally low.
2. 2. Esto ha hecho que los Bancos hayan visto que el negocio se les hacía más pequeño: This has meant that banks have seen that the business made them smaller:
•Daban préstamos a un bajo interés They gave loans at low interest rates
•Pagaban algo por los depósitos de los clientes (cero si el depósito está en cuenta corriente y, si además, cobran Comisión de Mantenimiento, pagaban “menos algo”) They paid something for the customer deposits (zero if the shell is in current accounts and, if also charged Maintenance Committee, paid "unless something")
•Pero, con todo, el Margen de Intermediación (“a” menos “b”) decrecía But still, the intermediation margin ( "a" minus "b") decreased
3. 3. A alguien, entonces, en América, se le ocurrió que los Bancos tenían que hacer dos cosas: Someone, then, in America, he decided that banks had to do two things:
•Dar préstamos más arriesgados , por los que podrían cobrar más intereses Give more risky loans, by which they can charge more interest
•Compensar el bajo Margen aumentando el número de operaciones (1000 x poco es más que 100 x poco) Compensate for the low margin by increasing the number of operations (1000 x bit is only 100 x bit)
4. 4. En cuanto a lo primero (créditos más arriesgados), decidieron: As to the first (riskier loans), they decided:
•Ofrecer hipotecas a un tipo de clientes, los “ninja” (personas sin ingresos fijos, sin empleo fijo, sin propiedades) Offer mortgages at a rate of clients, the "ninja" (people without steady income, without fixed employment without property)
•Cobrarles más intereses , porque había más riesgo Charging more interest because there were more risk
•Aprovechar el boom inmobiliario que había en el mercado norteamericano Harnessing the housing boom that was in the U.S. market
•Además, llenos de entusiasmo, decidieron conceder créditos hipotecarios por un valor superior al valor de la casa que compraba el ninja, porque, con el citado boom inmobiliario, esa casa, en pocos meses, valdría más que la cantidad dada en préstamo. Moreover, full of enthusiasm, decided to grant mortgage loans worth more than the value of the house that he bought the ninja, because, in the aforementioned housing boom, the house in a few months, would be worth more than the amount given on loan.
•A este tipo de hipotecas, les llamaron “hipotecas subprime” This type of mortgage, they were called "subprime"
•Se llaman “hipotecas prime” las que tienen poco riesgo de impago. They are called "prime mortgages" which have little risk of default. En una escala de clasificación entre 300 y 850 puntos, las hipotecas prime están valoradas entre 850 puntos las mejores y 620 las menos buenas. On a rating scale between 300 and 850 points, prime mortgages are worth 850 points between the best and 620 the least good.
•Se llaman “hipotecas subprime” las que tienen más riesgo de impago y están valoradas entre 620 las menos buenas y 300, las malas. They are called "subprime" which have a higher risk of default and are priced between 620 and 300 the least good, the bad.
•Además, como la economía americana iba muy bien, el deudor hoy insolvente podría encontrar trabajo y pagar la deuda sin problemas . Moreover, as the U.S. economy was going great, the insolvent debtor could find a job today and pay the debt without problems.
•Este planteamiento fue bien durante algunos años. This approach was well for some years. En esos años, los ninja iban pagando los plazos de la hipoteca y, además, como les habían dado más dinero del que valía su casa, se habían comprado un coche, habían hecho reformas en la casa y se habían ido de vacaciones con la familia . In those years, the ninja were paying the mortgage installments and also as they had been given more money than their house was worth, had bought a car, had been renovating the house and had gone on holiday with family . Todo ello, seguramente, a plazos, con el dinero de más que habían cobrado y, en algún caso, con lo que les pagaban en algún empleo o chapuza que habían conseguido. This, surely, in installments, with the extra money they had charged and, in some cases, which were paid in a botched job or they had achieved.
5.Primer comentario: creo que, hasta aquí, todo está muy claro y también está claro que cualquier persona con sentido común, aunque no sea un especialista financiero, puede pensar que, 5.Primer Comment: I think, so far, everything is clear and it is also clear that anyone with common sense, although not a financial expert may think, si algo falla, el batacazo puede ser importante if something fails, the thud could be important . .
6. 6. En cuanto a lo segundo (aumento del número de operaciones): As for the second (increased number of operations):
•Como los Bancos iban dando muchos préstamos hipotecarios, se les acababa el dinero. Like many banks were giving loans, they ran out of money. La solución fue muy fácil: acudir a Bancos extranjeros para que les prestasen dinero, porque para algo está la globalización. The solution was easy: go to foreign banks to lend them money, because something is globalization. Con ello, el dinero que yo, hoy por la mañana, he ingresado en la Oficina Central de la Caja de Ahorros de San Quirico de Safaja puede estar esa misma tarde en Illinois, porque allí hay un Banco al que mi Caja de Ahorros le ha prestado mi dinero para que se lo preste a un ninja . With that, the money that I, this morning, I joined the Central Office Savings Bank of San Quirico de Safaja may be that afternoon in Illinois, because there's a bank to which my Savings Bank has lent my money to pay him a ninja. Por supuesto, el de Illinois no sabe que el dinero le llega desde mi pueblo, y yo no sé que mi dinero, depositado en una entidad seria como es mi Caja de Ahorros, empieza a estar en un cierto riesgo. Of course, Illinois does not know that the money comes from my people, and I know that my money would be deposited into an entity like myself Savings Bank, began to be at some risk. Tampoco lo sabe el Director de la Oficina de mi Caja, que sabe -y presume- de que trabaja en una Institución seria. Neither does the Director of the Office of my box, who knows, "and presumed" that works in a serious institution. Tampoco lo sabe el Presidente de la Caja de Ahorros, que sólo sabe que tiene invertida una parte del dinero de sus inversores en un Banco importante de Estados Unidos. Neither does the President of the Savings Bank, which is only known to have invested some money of its investors in a major U.S. bank.
7. 7. Segundo comentario: la globalización tiene sus ventajas, pero también sus inconvenientes, y sus peligros Second comment: globalization has its advantages but also disadvantages and its dangers . . La gente de San Quirico no sabe que está corriendo un riesgo en Estados Unidos y cuando empieza a leer que allí se dan hipotecas subprime, piensa: “¡Qué locuras hacen estos americanos!” The people of San Quirico not know who is taking a risk in the U.S. and when he begins to read that there are subprime mortgages, thinks: "What do these crazy Americans!"
8. 8. Además, resulta que existen las “Normas de Basilea” Furthermore, it appears that there are "Basel Standards" , que exigen a los Bancos de todo el mundo que tengan un Capital mínimo en relación con sus Activos. , Which require banks worldwide that have a minimum capital in relation to their assets. Simplificando mucho, el Balance del Banco de Illinois es: To oversimplify, the Balance Sheet of the Bank of Illinois is:
ACTIVO PASIVO ASSETS LIABILITIES
Dinero en Caja Dinero que le han prestado otros Bancos Money Money Box that other banks have lent
Créditos concedidos Capital Credits granted Capital
Reservas Reservations
TOTAL X millones X millones TOTAL X million X million
Las Normas de Basilea exigen que el Capital de ese Banco no sea inferior a un determinado porcentaje del Activo. The Basel rules require that the capital of the Bank not less than a certain percentage of assets. Entonces, si el Banco está pidiendo dinero a otros Bancos y dando muchos créditos, el porcentaje de Capital sobre el Activo de ese Banco baja y no cumple con las citadas Normas de Basilea. So if the bank is borrowing money from other banks and giving lots of credit, the percentage of Assets Capital Bank for the low and does not comply with the Guidelines of Basel.
9. 9. Hay que inventar algo nuevo. You have to invent something new. Y eso nuevo se llama Titulización : el Banco de Illinois “empaqueta” las hipotecas -prime y subprime- en paquetes que se llaman MBS (Mortgage Backed Securities, o sea, Obligaciones garantizadas por hipotecas). And that again is called Securitization: the Bank of Illinois "bags"-prime mortgages and subprime-in packages that are called MBS (Mortgage Backed Securities, or obligations secured by mortgages). O sea, donde antes tenia 1.000 hipotecas “sueltas”, dentro de la Cuenta “Créditos concedidos”, ahora tiene 10 paquetes de 100 hipotecas cada uno, en los que hay de todo, bueno (prime) y malo (subprime), como en la viña del Señor. So, where once had 1,000 mortgages "loose" within the Account "Credits granted, now has 10 packs of 100 mortgages each, in which there is everything, good (prime) and bad (subprime) and in the Lord's vineyard.
10. 10. El Banco de Illinois vende rápidamente esos 10 paquetes: The Bank of Illinois quickly sold those 10 packages:
•¿Dónde va el dinero que obtiene por esos paquetes? Where does the money he gets for these packages? Va al Activo, a la Cuenta de “Dinero en Caja”, que aumenta, disminuyendo por el mismo importe la Cuenta “Créditos concedidos”, con lo cual la proporción Capital/Créditos concedidos mejora y el Balance del Banco cumple con las Normas de Basilea . Goes to the Assets, to the account "cash", increasing, decreasing by the same amount the account "Loans granted", so that the proportion Capital / Loans granted improvement and Bank Balance meets Basel .
•¿Quién compra esos paquetes y además los compra rápidamente para que el Banco de Illnois “limpie” su Balance de forma inmediata? ¡Muy buena pregunta! El Banco de Illinois crea unas entidades filiales, los conduits , que no son Sociedades, sino trusts o fondos, y que, por ello no tienen obligación de consolidar sus Balances con los del Banco matriz. Very good question! Illinois Bank creates affiliated entities, the conduits, which are not companies, but trusts or funds, and which therefore are not required to consolidate its accounts with the Bank's matrix. Es decir, de repente, aparecen en el mercado dos tipos de entidades: That is, suddenly appear on the market two types of entities:
El Banco de Illinois, con la cara limpia, y el Chicago Trust Corporation (o el nombre que le queráis poner), con el siguiente Balance: The Bank of Illinois, with a clean face, and the Chicago Trust Corporation (or whatever name you please put it) with the following balance:
ACTIVO PASIVO ASSETS LIABILITIES
Los 10 paquetes de hipotecas Capital: lo que ha pagado por esos paquetes The 10 packages of mortgages Capital: what you pay for those packages
11. 11. Tercer comentario: Si cualquier persona que trabaja en la Caja de Ahorros de San Quirico, desde el Presidente al Director de la Oficina supiera algo de esto, se buscaría rápidamente otro empleo Third comment: If any person working in the Savings Bank of San Quirico, from President to Director of the Bureau knew anything about this, he would seek another job quickly . . Mientras tanto, todos hablan en Expansión de sus inversiones internacionales, de las que ya veis que no tienen la más mínima idea. Meanwhile, everyone speaks in Expansion of its international investments, of which you see that do not have the slightest idea.
12. 12. ¿Cómo se financian los conduits? How are they financed the conduits? En otras palabras, ¿de dónde sacan dinero para comprar al Banco de Illinois los paquetes de hipotecas? In other words, where do they get money to buy the Bank of Illinois mortgage packages? De varios sitios: Multiple sites:
•Mediante créditos de otros Bancos (Cuarto comentario: La bola sigue haciéndose más grande ) Through credit from other banks (Fourth Comment: The ball is getting bigger)
•Contratando los servicios de Bancos de Inversión que pueden vender esos MBS a Fondos de Inversión, Sociedades de Capital Riesgo, Aseguradoras, Financieras, Sociedades patrimoniales de una familia, etc. (Quinto comentario: fijaos que el peligro se nos va acercando, no a España, sino a nuestra familia, porque igual, animado por el Director de la oficina de San Quirico, voy y meto mi dinero en un Fondo de Inversión) Employing the services of investment banks can sell the MBS to Investment Funds, Venture Capital Companies, Insurance Companies, Financial Companies in a family heritage, etc. (Fifth comment: Fixed that danger is approaching us, not to Spain but to our family, because like, animated by the Director of the office of San Quirico, and I put my money into an investment fund)
•Lo que pasa es que, para ser “financieramente correctos”, los conduits o MBS tenían que ser bien calificados por las agencias de rating , que dan calificaciones en función de la solvencia. Estas calificaciones dicen: “A esta empresa, a este Estado, a esta organización se le puede prestar dinero sin riesgo”, o “tengan cuidado con estos otros porque se arriesga usted a que no le paguen” . What happens is that to be "financially correct", the MBS conduits or had to be well qualified by the rating agencies that give ratings in terms of solvency. These ratings say, "This company, in this state, this organization may lend money without risk, "or" beware of these other risks because you do not get paid. "
RATING: Calificación crediticia de una Compañía o una Institución, hecha por una agencia especializada. RATING: Rating of a company or an institution, made by a specialized agency. En España, la agencia líder en este campo es Fitch Ratings. In Spain, the lead agency in this field is Fitch Ratings.
Los niveles son: The levels are:
AAA, el máximo AAA, the highest
AA AA
A A
BBB BBB
BB BB
Otros, pero son muy malos Others, but they are very bad
En general: Overall:
Un Banco o Caja grande suele tener un rating de AA A bank or big box usually has a rating of AA
Un Banco o Caja mediano, un rating de A A medium or Savings Bank, a rating of A
•Las Agencias de rating otorgaban estas calificaciones o les daban otros nombres, más sofisticados, pero que, al final, dicen lo mismo: The rating agencies gave these ratings or were given other names, more sophisticated, but at the end, say the same:
Llamaban: Investment grade a los MBS que representaban hipotecas prime, o sea, las de menos riesgo (serían las AAA, AA y A), Mezzanine , a las intermedias (supongo que las BBB y quizá las BB), Equity a las malas, de alto riesgo, o sea, a las subprime, que, en este tinglado, son las protagonistas . Called: Investment grade MBS representing the prime mortgages, or those of least risk (be the AAA, AA and A), Mezzanine, the intermediate (I guess maybe the BBB and BB), Equity to bad, high risk, ie the subprime, that in this shed, are the protagonists.
•Los Bancos de Inversión colocaban fácilmente las mejores (investment grade), a inversores conservadores, ya intereses bajos. Investment Banks placed easily the best (investment grade) to conservative investors, and low interest rates.
•Otros gestores de Fondos, Sociedades de Capital Riesgo, etc, más agresivos. Other fund managers, venture capital companies, etc., more aggressive. pretendían obtener, a toda costa, rentabilidades más altas, entre otras razones porque esos señores cobran el bonus de final de año en función de la rentabilidad obtenida . sought to obtain, at all costs, higher returns, among other reasons because these men earning the year-end bonus depending on the profitability.
•Problema: ¿Cómo vender MBS de los malos a estos últimos gestores sin que se note excesivamente que están incurriendo en riesgos excesivos? Problem: How to sell MBS of bad managers latter without being noticed too that are incurring excessive risk?
•Sexto Comentario: La cosa se complica y, por supuesto, los de la Caja de Ahorros de San Quirico siguen haciendo declaraciones en Expansión felices y contentos, hablando de la buena marcha de la economía y de la Obra Social que están haciendo. Sixth Comment: The plot thickens and, of course, those of the Savings Bank of San Quirico continue making statements Expansion happily, talking about the good of the economy and Social Work are doing.
•Algunos Bancos de Inversión lograron, de las Agencias de Rating una recalificación (un re-rating, palabro que no existe, pero que sirve para entendernos) Managed investment banks, rating agencies of a reclassification (a re-rating, a word that does not exist, but it serves to understand)
•El re-rating es un invento para subir el rating de los MBS malos , que consiste en estructurarlos en tramos, a los que les llaman tranches , ordenando, de mayor a menor, la probabilidad de un impago, y con el compromiso de priorizar el pago a los menos malos. The re-rating is an invention to raise the rating of the bad MBS, which is structured to sections, which are called tranches, ordering, highest to lowest, the probability of default, and the commitment to prioritize payment to the least bad. Es decir: That is:
Yo compro un paquete de MBS, en el que me dicen que los tres primeros MBS son relativamente buenos, los tres segundos, muy regulares y los tres terceros, francamente malos. I buy a package of MBS, which tells me that the first three MBS are relatively good, the three seconds, very regular and the three others, frankly bad. Esto quiere decir que he estructurado el paquete de MBS en tres tranches: el relativamente bueno, el muy regular y el muy malo. This means that I have structured the package of MBS into three tranches: the relatively good, very regular and very bad.
Me comprometo a que si no paga nadie del tranche muy malo (o como dicen estos señores, si en el tramo malo incurro en default), pero cobro algo del tranche muy regular y bastante del relativamente bueno, todo irá a pagar las hipotecas del tranche relativamente bueno, con lo que, automáticamente, este tranche podrá ser calificado de AAA. I pledge that if the tranche will not pay very bad (or as they say these gentlemen, if in the wrong section I incur default), but some of the tranche recovery very regular and much of the relatively good, everything will go to pay mortgages tranche relatively good, which automatically adds this tranche will be rated AAA.
Séptimo comentario: en los “Comentarios de Coyuntura Económica del IESE”, de Enero 2008, de los que he sacado la mayor parte de lo que os estoy diciendo, le llaman a esto “magia financiera” Seventh comment: in the "Comments IESE Economic Situation, January 2008, I've got most of what I'm saying, I call this" financial magic "
•Para acabar de liar a los de San Quirico, estos MBS ordenados en tranches fueron rebautizados como CDO (Collateralized Debt Obligations, Obligaciones de Deuda Colateralizada), como se les podía haber dado otro nombre exótico. To finish rolling to San Quirico, arranged in these MBS tranches were renamed CDO (Collateralized Debt Obligations, Collateralized debt obligations), as they could have taken another exotic name.
No contentos con lo anterior, los magos financieros crearon otro producto importante: los CDS (Credit Default Swaps) En este caso, el adquirente, el que compraba los CDO, asumía un riesgo de impago por los CDO que compraba, cobrando más intereses. Not content with this, the financial wizards created another important product: the CDS (Credit Default Swaps) In this case, the purchaser, who bought the CDO, assuming a risk of default by buying CDOs, charging interest. O sea, compraba el CDO y decía: “si falla, pierdo el dinero. So, I bought the CDO and said, "if it fails, I lose money. Si no falla, cobro más intereses” . If it fails, recovery plus interest.
Siguiendo con los inventos, se creó otro instrumento, el Synthetic CDO, que no he conseguido entender, pero que daba una rentabilidad sorprendentemente elevada. Continuing with the inventions created another instrument, the Synthetic CDO, which I failed to understand, but which gave a surprisingly high yield.
Más aún: los que compraban los Synthetic CDO podían comprarlos mediante créditos bancarios muy baratos. Moreover, those who bought the Synthetic CDO through bank loans could buy very cheap. El diferencial entre estos intereses muy baratos y los altos rendimientos del Synthetic hacía extraordinariamente rentable la operación. The interest differential between these very cheap and high yields of Synthetic operation was extremely profitable.
13. 13. Al llegar aquí y confiando en que no os hayáis perdido demasiado, quiero recordar una cosa que es posible que se os haya olvidado, dada la complejidad de las operaciones descritas: que At this point and hoping that ye are not lost too much, I recall something that you may be you have forgotten, given the complexity of the operations, that todo está basado en que los ninjas pagarán sus hipotecas y que el mercado inmobiliario norteamericano seguirá subiendo. everything is based on the ninjas pay their mortgages and that the U.S. housing market will continue to rise.
14. 14. PERO: BUT:
•A principios de 2007, los precios de las viviendas norteamericanas se desplomaron . In early 2007, prices of U.S. homes plunged.
•Muchos de los ninjas se dieron cuenta de que estaban pagando por su casa más de lo que ahora valía y decidieron (o no pudieron) seguir pagando sus hipotecas. Many of the ninjas they realized they were paying for more home now worth and what has (or could not) continue to pay their mortgages.
•Automáticamente, nadie quiso comprar MBS, CDO, CDS, Synthetic CDO y los que ya los tenían no pudieron venderlos . Automatically, no one wanted to buy MBS, CDO, CDS, Synthetic CDOs and who already had failed to sell.
•Todo el montaje se fue hundiendo y un día, el Director de la Oficina de San Quirico llamó a un vecino para decirle que bueno, que aquel dinero se había esfumado , o, en el mejor de los casos, había perdido un 60 % de su valor. The entire assembly sank and one day, the Director of the Office of San Quirico a neighbor called to say that good that the money was gone, or, at best, had lost 60% of its asset.
•Octavo comentario: Vete ahora a explicar al vecino de San Quirico lo de los ninjas, el Bank de Illinois y el Chicago Trust Corporation. Eighth comment: Go now to explain to the neighboring San Quirico what the ninjas, the Bank of Illinois and the Chicago Trust Corporation. No se le puede explicar por varias razones: la más importante, porque nadie sabe dónde está ese dinero. You can not be explained by several reasons: the most important, because nobody knows where that money. Y al decir nadie, quiero decir NADIE . And when I say nobody, I mean NOBODY.
•Pero las cosas van más allá. But things go further. Porque nadie -ni ellos- sabe la porquería que tienen los Bancos en los paquetes de hipotecas que compraron, y como nadie lo sabe, los Bancos empiezan a no fiarse unos de otros. Because no one-not-know the crap they have in banks that bought mortgage packages, and as anyone knows, the banks start to not trust each other.
•Como no se fían, cuando necesitan dinero y van al MERCADO INTERBANCARIO, que es donde los Bancos se prestan dinero unos a otros, o no se lo prestan o se lo prestan caro . As they trust when they need money and go to the interbank market, where banks lend each other money, or do not lend it or lend it expensive. El interés a que se prestan dinero los Bancos en el Interbancario es el Euribor (Europe Interbank Offered Rate, o sea, Tasa de Interés ofrecida en el mercado interbancario en Europa), tasa que, como podéis ver en el vocablo EURIBOR A 3 MESES de este Diccionario, ha ido subiendo (ahora está empezando a bajar.) The interest that banks lend money in the interbank Euribor (Europe Interbank Offered Rate, or interest rate offered on the interbank market in Europe), a rate which, as you see in the term of 3-month Euribor this Dictionary, has gone up (now beginning to fall.)
•Por tanto, los Bancos ahora no tienen dinero. Therefore, banks have no money now. Consecuencias: Consequences:
i. i. No dan créditos Noncredit
ii. ii. No dan hipotecas, con lo que los Astroc, Renta Corporación, Colonial, etc., lo empiezan a pasar mal, MUY MAL. They do not give mortgages, so that Astroc, Renta Corporation, Colonial, etc., I begin to go terribly wrong. Y los accionistas que compraron acciones de esas empresas, ven que las cotizaciones de esas Sociedades van cayendo vertiginosamente. And shareholders who bought shares of these companies, they see that the prices of these companies are falling sharply.
iii. iii. El Euribor a 12 meses, que es el índice de referencia de las hipotecas, ha ido subiendo, lo que hace que el español medio, que tiene su hipoteca, empieza a sudar para pagar las cuotas mensuales . The 12-month Euribor, which is the benchmark for mortgages has been rising, which makes the Spanish average, which is your mortgage, start to sweat to pay the monthly installments.
iv. Como los Bancos no tienen dinero, iv. As the banks have no money,
1. 1. Venden sus participaciones en empresas They sell their holdings in companies
2. 2. Venden sus edificios They sell their buildings
3. 3. Hacen campañas para que metamos dinero, ofreciéndonos mejores condiciones Metamos campaigning for money, offering better conditions
v. v. Como la gente empieza a sentirse apretada por el pago de la hipoteca, va menos al Corte Inglés. As people begin to feel squeezed by the mortgage payment, unless the Court is English.
vi. vi. Como el Corte Inglés lo nota, compra menos al fabricante de calcetines de Mataró, que tampoco sabía que existían los ninja. As the English Court notices, purchase unless the manufacturer of socks in Mataró, nor the ninja knew existed.
vii. vii. El fabricante de calcetines piensa que, como vende menos calcetines, le empieza a sobrar personal y despide a unos cuantos. The sock manufacturer believes that sells less socks as he starts on the staff and fired a few.
viii. viii. Y esto se refleja en el índice de paro, fundamentalmente en Mataró, donde la gente empieza a comprar menos en las tiendas. And this is reflected in the unemployment rate, mainly in Mataró, where people start buying less in stores.
15. 15. Esto es un Diccionario de vocablos. This is a dictionary of words. Lo que pasa es que el vocablo “Crisis 2007-2008” es muy serio. What happens is that the word "Crisis 2007-2008" is very serious. El título puede inducir a error, pensando que la crisis se va a acabar en 2008. The title is misleading, considering that the crisis will end in 2008. Ahora viene otra pregunta: “¿Hasta cuándo va a durar esto? Now comes another question: "How long will this last?
16. 16. Pues muy buena pregunta, también. Well very good question, too. muy difícil de contestar, por varias razones: very difficult to answer, for several reasons:
•Porque se sigue sin conocer la dimensión del problema (las cifras varían de 100.000 a 500.000 millones de dólares) Because they remain unaware of the extent of the problem (the numbers vary from 100,000 to 500,000 million dollars)
•Porque no se sabe quiénes son los afectados. No se sabe si mi Banco, el de toda la vida, Banco serio y con tradición en la zona, tiene mucha porquería en el Activo. Because no one knows who is affected. We do not know if my bank, the lifelong, serious Bank and tradition in the area, has plenty of dirt on the Assets. Lo malo es que mi Banco tampoco lo sabe. The trouble is that my bank does not know.
•Cuando, en América, las hipotecas no pagadas por los ninja se vayan ejecutando, o sea, los Bancos puedan vender las casas hipotecadas por el precio que sea, algo valdrán los MBS, CDO, CDS y hasta los Synthetic. When, in America, mortgage defaults by the ninja are implemented, that is, banks can sell the houses mortgaged for the price it is, something will be worth the MBS, CDO, CDS and even Synthetic.
•Mientras tanto, nadie se fía de nadie. Meanwhile, nobody trusts anybody.
17. 17. Noveno comentario: Ninth comment:
•Alguien ha calificado este asunto como “la gran estafa” Someone has described this as "the great swindle"
•Otros han dicho que el Crack del 29, comparado con esto, es un juego de niñas en el patio de recreo de un convento de monjas. Others have said that the Crash of 29, compared to this, is a game of girls in the playground of a convent.
•Bastantes, quizá muchos, se han enriquecido con los bonus que han ido cobrando . Enough, perhaps many, have been enriched with the bonus that had been gathering. Ahora, se quedarán sin empleo, pero tendrán el bonus guardado en algún lugar, quizá en un armario blindado, que es posible que sea donde esté más seguro y protegido de otras innovaciones financieras que se le pueden ocurrir a alguien. Now, will be jobless, but the bonus will be saved somewhere, perhaps in an armored closet, which may be where more secure and protected from other financial innovations that can happen to anyone.
•Las autoridades financieras tienen una gran responsabilidad sobre lo que ha ocurrido . The financial authorities have a major responsibility for what happened. Las Normas de Basilea, teóricamente diseñadas para controlar el sistema, han estimulado la TITULIZACIÓN hasta extremos capaces de oscurecer y complicar enormemente los mercados a los que se pretendía proteger. The Basel rules theoretically designed to control the system, stimulated the SECURITIZATION to extremes can obscure and complicate enormously the markets they are intended to protect.
•Los Consejos de Administración de las entidades financieras involucradas en este gran fiasco, tienen una gran responsabilidad, porque no se han enterado de nada . The Boards of Directors of financial institutions involved in this big fiasco, have a great responsibility, because they have not heard anything. Y ahí incluyo el Consejo de Administración de la Caja de Ahorros de San Quirico. And that included the Board of Directors of the Savings Bank of San Quirico.
•Algunas agencias de rating han sido incompetentes o no independientes respecto a sus clientes, lo cual es muy serio Some rating agencies have been incompetent or independent from their clients, which is very serious
18. 18. Fin de la historia (por ahora): los principales Bancos Centrales (el Banco Central Europeo, la Reserva Federal norteamericana) han ido inyectando liquidez monetaria para que los Bancos puedan tener dinero End of story (for now): the major central banks (European Central Bank, the U.S. Federal Reserve) have been injecting liquidity to allow banks to have money . .
19. 19. Hay expertos que dicen que sí que hay dinero, pero que lo que no hay es confianza Some experts say yes than no money, but what there is to confidence . . O sea, que la crisis de liquidez es una auténtica crisis de no fiarse del prójimo. That is, the liquidity crisis is not a real crisis of trust of others.
20. 20. Mientras tanto, los FONDOS SOBERANOS Meanwhile, SWFs , o sea, los Fondos de inversión creados por Estados con recursos procedentes del superávit en sus cuentas, (procedentes principalmente del petróleo y del gas) , Ie investment funds created by states with resources from the surplus in their accounts (mostly from oil and gas) como los Fondos de los Emiratos árabes, países asiáticos, Rusia, etc., están comprando participaciones importantes en Bancos americanos para sacarles del atasco en que se han metido Funds like the Arab Emirates, Asia, Russia, etc.., they are buying major stakes in American banks to get them out of jams that have gotten . .
Amigos!
Thank you very much for your Kms donated for "Caico Foundation" to fight against Cancer Childhood...you have contributed with 56.5% of YTD total Kms donated....but, still, 29 Kms to be donated...I am still far away from my goal!!
A common barrier to effective communication is poor listening skills. The human brain processes language much faster than most people talk. This leaves time for the listener to form personal perceptions, stereotypes and judgments. Interrupting the speaker with these perceptions contributes to flawed communication. Develop effective listening strategies to help bridge the gap caused by communication barriers and you will be able to listen more than you talk.
Dear Friends,
Again, a very nice experience and a lot to keep learning about transitions, "What to do and not to do!!"
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