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« UPDATE - DOW Trading DOWN More Than 400 Points | Main | Dow Turns NEGATIVE After Fed Statement, Losing 200 Points - Full Text Of FOMC Statement »

Euro Bank Bailout 2.0: SocGen & Unicredit Teetering On 'Brink Of Collapse'

UPDATE - French banking giant Societe Generale is fighting insolvency rumors, trading down 16% while French CDS spike on rumors of a credit downgrade of sovereign France.

UPDATE - DOW is trading down more than 400 points.


Daily Mail

Fears are growing this weekend that two of Europe’s largest banks may require a bailout, having been hugely damaged by the worsening crisis across the eurozone.

In France, President Nicolas Sarkozy is having to confront the possibility that the country’s second-biggest bank, Societe Generale -commonly known as SocGen - is on the brink of disaster after huge losses over loans made to Greece.

The chilling possibility of the largest bank in Italy, UniCredit Banca, suffering a similar collapse if a bailout is not implemented comes as Silvio Berlusconi already faces an increasingly dangerous national economic situation.

In Britain, a senior Government source described the position of the two banks as ‘perilous’, although an official Treasury spokesman declined to comment. Should either bank collapse, British customers with deposits of up to about £85,000 would be protected by the Financial Services Compensation Scheme.

The merest hint a major bank might fall is likely to reignite panic tomorrow in the stock market, which is already feared to react badly to the credit downgrade of the U.S. by rating agency Standard & Poor’s.

Last night Chancellor George Osborne, whose Treasury officials have ‘war-gamed’ various scenarios ahead of the markets opening, was due to discuss the crisis with Christine Lagarde, head of the International Monetary Fund (IMF).

SocGen reported a loss of £350million on Greek debt last week. It has a total of £2.2billion of Greek debt and also owns 88 per cent of the Greek bank Geniki, whose value has collapsed in recent months.

For Italy, damage to UniCredit, in which Barclays has a two per cent share, would be a bitter blow. Its strategy of caution has led it to invest heavily in Italian government bonds which were until recently seen as safe, but as these have come under pressure the bank’s shares have plummeted.

Experts fear that if any single bank is seen to be in trouble, all lending could freeze up in the resultant climate of fear, with devastating consequences.

As ministers of the G7 nations - Britain, France, Italy, Germany, Japan, the U.S. and Canada - prepare to meet to discuss the mounting euro crisis, the French and Italian governments are believed to be standing ready to rescue the banking giants.

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Reader Comments (9)

Look at the Globalist weasel at the top, looks like his blood stained fingers can't wait to buy up the world for pennies on their scam to enslave us all.
Aug 7, 2011 at 2:04 PM | Unregistered CommenterAl
John...you will enjoy this one i'm sure...

U.S. government support for renewable energy may plunge from record levels, setting back the use of wind and solar power before they can compete on their own with oil, gas and coal.

Aug 7, 2011 at 2:44 PM | Registered CommenterDailyBail
Aug 7, 2011 at 3:03 PM | Registered CommenterDailyBail
Aug 7, 2011 at 3:03 PM | Registered CommenterDailyBail
Aug 7, 2011 at 3:06 PM | Registered CommenterDailyBail
(Reuters) - Doubts are growing in the German government that Italy could be rescued by the European emergency fund, even if the fund were to be tripled in size, according to the German newsmagazine Der Spiegel.

Aug 7, 2011 at 6:58 PM | Registered CommenterDailyBail
ECB Intervenes In Last Minutes Of Euro Market Trading As Italy Closes Red Once Again



This aggression of a red close in the FTSE MIB will not stand man. Which is why Trichet just went ahead and sent the cavalry to buy another X billion worth of Irish 10 years to send a powerful message that European taxpayer capital will be used to purchase worthless paper that is cash flow bad, until morale improves.

Hey Trichet, ever hear of the inverse? (inverse from front page photo).....

Aug 9, 2011 at 11:48 AM | Unregistered Commenterjohn
Glad you brought up the Infrastructure Bank here is what that will do raise your taxes for the banksters..

House Budget Committee on the Coming National Infrastructure Bank

A few days back I reported on the National Infrastructure Bank that is in the planning stages by the President and Congress. It will generate huge fees for the banksters and make-work jobs for union members.


The Bankster Plan to Hijack the Next Budget Deal


And as I said in another comment Dylan Ratigan is a tool he is promoting that and says nothing about the Fed.

Dylan Ratigan Rant Over Political and Economic System Designed to “Extract America”

Aug 10, 2011 at 12:37 PM | Unregistered CommenterLiberatedCitizen

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