93 Words, Near Of Them Wrong
In the WSJ, The 93 Words That Could Unlock $200 Billion inwards Bank Capital. This could hold upward a cracking MBA terminal exam. Spot the errors:
Windfall? When a fellowship pays out dividends, the stock toll goes downward precisely past times the sum of the dividend payment.
Capital is non tied up. Capital is a rootage of funds, non a purpose of funds. Capital is equity investment inwards the banking concern -- people laissez passer on the banking concern money, inwards render for a flow of dividends. Capital is non reserves -- cash lying around the vault.
Capital is already used for lending! Banks larn coin from equity holders, bond holders, together with deposits, together with lend it out. Capital requirements are virtually the ratio of sources of money. (At best, lower upper-case alphabetic lineament requirements would allow banks to borrow to a greater extent than coin without issuing to a greater extent than equity to lend. If they wanted to.) Capital is non reserves.
No banking concern "holds" capital, together with I promise Mr. Dimon didn't truly rank that, every bit much every bit he would similar lower upper-case alphabetic lineament requirements. Capital is non "held" similar reserves.
This article does reverberate nicely the full marking of confusion inwards the fence virtually banking regulations. Colleagues contemplating clever complex schemes, stimulate got note.
"Tucked within a nearly 600-page legislative proposal to overhaul U.S. fiscal regulations are 93 words that could render a windfall for banking concern investors seeking heftier dividends together with part buybacks."
"Bank analysts at Barclays BCS -6.08% PLC gauge $236 billion inwards upper-case alphabetic lineament is tied upward in operational direct chances at the 4 biggest U.S. banks alone"
"Bankers ... desire to gratuitous upward upper-case alphabetic lineament that could hold upward returned to shareholders or used for to a greater extent than lending."
"Mr. Dimon added that U.S. banks instantly hold about $200 billion inwards upper-case alphabetic lineament against operational risk."(I made it easier amongst italics, all mine.)
Windfall? When a fellowship pays out dividends, the stock toll goes downward precisely past times the sum of the dividend payment.
Capital is non tied up. Capital is a rootage of funds, non a purpose of funds. Capital is equity investment inwards the banking concern -- people laissez passer on the banking concern money, inwards render for a flow of dividends. Capital is non reserves -- cash lying around the vault.
Capital is already used for lending! Banks larn coin from equity holders, bond holders, together with deposits, together with lend it out. Capital requirements are virtually the ratio of sources of money. (At best, lower upper-case alphabetic lineament requirements would allow banks to borrow to a greater extent than coin without issuing to a greater extent than equity to lend. If they wanted to.) Capital is non reserves.
No banking concern "holds" capital, together with I promise Mr. Dimon didn't truly rank that, every bit much every bit he would similar lower upper-case alphabetic lineament requirements. Capital is non "held" similar reserves.
This article does reverberate nicely the full marking of confusion inwards the fence virtually banking regulations. Colleagues contemplating clever complex schemes, stimulate got note.
0 Response to "93 Words, Near Of Them Wrong"
Posting Komentar