Don Coxe – Get Ready, Banks to Collapse In Europe

Tuesday, June 26, 2012
By Paul Martin
June 26, 2012

Today 40 year veteran, Don Coxe, told King World News “…the amounts involved are at mind-boggling levels,” in terms of what is needed for Europe’s governments and banks. Coxe, who is Global Strategy Advisor to BMO ($538 billion in assets), also said that European banks, “…have borrowed huge amounts of money, in dollars, under currency swap arrangements,” and “if banks start to go down, we know from 2008, when banks start to crumble, then the whole system falls.” Here is what Coxe had to say about the ongoing crisis: “Well, first of all we’ve got to stop using ‘billions’ because if there is going to be a fund that works, it’s going to have a ‘T’ (for trillions) on it. We are dealing with some very big numbers in the sense that Italy, although it’s not that big of an economy, it’s got the third largest amount of bond debt outstanding.”

Don Coxe continues:

“So Italy’s situation is truly serious because they also have a short duration on their debt. If you were holding a three-year Italian bond, but it’s only got three months to maturity, you are probably not going to sell it now because you want to get your money out. But you are not likely to roll it over, unless you are an Italian bank.

So what’s happened is we’ve gradually narrowed down the range of those who, even when the bonds are maturing, want to buy more. We’ve converted the entire European banking system into a funding for the government deficits.

Therefore, we have this situation of two drunks, at night, leaning up against each other, bad governments and bad banks, but the amounts involved are at mind-boggling levels….

The Rest…HERE

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