Fox Business
Expand
Browse All Video
Watch Live

You're watching...

Are U.S. Banks Healthy Despite Downgrades?

Details

  • Description

    NBT Equity Group founder Tobin Smith on the state of the U.S. financial sector.

  • Duration 3:50
  • Date

Clips

Also in this playlist...

Latest Video

Auto-advance: ON

Auto-advance
View All

Transcript

This transcript is automatically generated

Look who's back.

These prizes was not originated in Europe.

Since you mentioned must America these -- just want to rejected us America.

Sam looked time -- see that -- I would just throwing got to contact your neck.

Hello -- -- Puts him updated so I want did suffer and I might -- -- -- pump up but the desire.

I am on to you you euros zero.

Get a lot of that this -- got this is same guys criticizing US banks for everything that ails Europe.

I mean he's going back to -- hundred years war I don't think we -- back America back.

All right the eurozone -- gunning down our banks and Moody's cuts their ratings fifteen of them getting that hammers you heard.

Stocks today not getting hammered -- actually a lot of ending up.

Thompson says the banks are actually healthy and it's the ratings agencies that could be making that I don't know licenses by the way -- had done now but that's what we said Doucet.

But what -- -- -- had at this of the the ratings agencies sort of play like this Europe commission president insult to injury.

Don't -- do remember they're always about a year two years behind the curve -- so this you know most the stuff they did I think is already been discounted the banks.

I'm the other part to -- is that so delay why do we okay whether I mean I the reaction was largely sanguine I mean.

Well you know like borders Ellie -- thought it was going to be three you know not grades are not to other ones they thought we're going to be three not just feel -- grateful that they weren't.

Totally -- I think everybody the issue here is that if I'm a bank and I have every certain rating according to regulatory authorities.

Before have to put cash out of my piggy bank can put it put more cash and buy some of these deals -- some of these bonds that I told etc.

so let's call collateral and the the -- catch up to put in.

They're against collateral less you have the land and that -- a downward cycle.

My guess is this what you're going to see -- -- gonna see regulators moved the goalposts closer.

Because the banks can't reason cash and the regulators are gonna step in and say well you know okay -- -- another three years off spending up and that's why I think you -- of the release.

What do you think.

We're back so they -- safer today we know they're not lending side I know I hear it is -- well they're not gonna lend out of event that a worry about it that was -- minister before but what.

What now what is -- that now they have to build up more cash on their books so I guess it's taken from somewhere what helping the European well.

Well first of what somebody European banks and in your good friends though over in Europe and European banks.

Our ranks you know our -- have a dollar and borrow nine dollars in deposits -- -- sort of business while in Europe they have a dollar they borrowed thirty dollars are much higher leverage so.

In India so how did this guy does he didn't follow up again does he gets Tobin had to accomplish how can this guy then.

Say it's our fault or US banks -- when they have sample occurrence of -- -- listen to him again because it gets my of my -- up here.

Can we say centers and -- that's in the week Dave Dave turned the Microsoft fare well they have had enough -- I don't know it's gonna keep talking but could -- -- well.

So ever remember.

So the European banks who bought all the sovereign debt they got less money by their use -- of their Ben Bernanke -- they took all the money and and then they bought the notes of Greece and Ireland and Italy center and I'm Spanish saying you know maybe it was a good idea.

So now they want the banks to -- -- this visibility government bailout the banks so that the ECB's in this Central Bank does have problems they have huge problems they'll that we don't have because we don't -- our banks that way.

And for them to come -- sort of -- this allegation out is sort of like saying.

You know our lasagna Indian you know and Puerto Rico is -- -- -- -- there weren't trying to say that this is a horrible idea I don't of the food and -- -- Well fugitive of them vines but we've had insisted he is now paid.

The movie -- -- of the crusades.

Hamas city on Citigroup.

Dotted and yeah not to let that and and they claim that we lost the world -- well yes you know those that don't get that's not bad enough they didn't talk is Angela -- --

Load More