Normally a 275 point fall on Wall Street, and a 600 point fall in Hong Kong, would make for some headlines. But this time, the media coverage has been very muted. Presumably everybody thinks it will be another ‘9 day wonder’, and believes with Chuck Prince of Citigroup that one simply has to keep ‘dancing’. But equally, there are some quite worrying opinions now being expressed about the underlying risks that might impact us later in the year or in 2008. I thought you might like to see them:
This could become ‘the worst banking crisis since 1931’. Jochen Sanio, head of Germany’s financial regulator.
‘We see a lot of people on the Street who are scared. We are not scared. We are not panicked. We are not rattled. Our team has been through this before.’ We are ’still dancing’. Chuck Prince, Citigroup CEO.
I have been at this for 22 years, and this is about as bad as I have seen it in the fixed-income market.’ Samuel L. Molinaro Jr., Bear Stearns’s CFO.
‘What we saw last month was a toy trainset model of what is in store for us with the unwinding of the great credit bubble’. John Dizard, Financial Times markets commentator.
(NB the first and last quotes are from the Financial Times, which unfortunately has a subscription only policy for its stories, so I haven’t included the link details in order to avoid frustration if you tried to click through).