Sunday, November 20, 2011
Things That Make You Go Hmmm.... Such As Basel I...II...III... And Onward
From Grant Williams latest TTMYGH: "Basel III attempts to force encourage banks to hold larger percentages of government bonds on their balance sheets in order to shore up their capital bases and to provide a riskless safety net should they run into liquidity problems. Thus far, holdings of Italian debt - with its 20% risk-weighting - have bankrupted MF Global in the space of a week (no 30-day cushion there, then) while the ECB SMP program has spent billions of euros accumulating 20%
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