Research Zeitgeist: Crisis Fallout
With the jury still out on the effectiveness of the myriad bank bailouts, topics related to the ongoing credit crisis and its fallout dominated the top posts this week. Visitors continued to come to Research Recap to keep up to date with ratings actions on financial companies in the new through our regular “Ratings Roundups.” Visitors were very interested in the OECD’s comparison of the differences in bank deposit insurance across countries. They might have taken comfort from Floyd Norris’s analysis in The New York Times showing that the impact of the banking crisis on the broader economy should be less in the US than in many other countries.
On a gloomier note, visitors were drawn to Moody’s warning that the credit crisis is likely to result in significant state and local budget cuts, including usually off-limits areas such K-12 education. Likewise there was strong interest in Fitch Ratings’ prediction of higher commercial real estate loan defaults.
Research Recap Quote of the Week:
We would be skeptical that a GM-Chrysler transaction could easily address our primary concern by resulting in a substantial increase of current liquidity for the parties involved.- S&P
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