this post was submitted on 24 Nov 2024
36 points (97.4% liked)

Europe

1565 readers
323 users here now

News and information from Europe 🇪🇺

(Current banner: La Mancha, Spain. Feel free to post submissions for banner images.)

Rules (2024-08-30)

  1. This is an English-language community. Comments should be in English. Posts can link to non-English news sources when providing a full-text translation in the post description. Automated translations are fine, as long as they don't overly distort the content.
  2. No links to misinformation or commercial advertising. When you post outdated/historic articles, add the year of publication to the post title. Infographics must include a source and a year of creation; if possible, also provide a link to the source.
  3. Be kind to each other, and argue in good faith. Don't post direct insults nor disrespectful and condescending comments. Don't troll nor incite hatred. Don't look for novel argumentation strategies at Wikipedia's List of fallacies.
  4. No bigotry, sexism, racism, antisemitism, dehumanization of minorities, or glorification of National Socialism.
  5. Be the signal, not the noise: Strive to post insightful comments. Add "/s" when you're being sarcastic (and don't use it to break rule no. 3).
  6. If you link to paywalled information, please provide also a link to a freely available archived version. Alternatively, try to find a different source.
  7. Light-hearted content, memes, and posts about your European everyday belong in !yurop@lemm.ee. (They're cool, you should subscribe there too!)
  8. Don't evade bans. If we notice ban evasion, that will result in a permanent ban for all the accounts we can associate with you.
  9. No posts linking to speculative reporting about ongoing events with unclear backgrounds. Please wait at least 12 hours. (E.g., do not post breathless reporting on an ongoing terror attack.)

(This list may get expanded when necessary.)

We will use some leeway to decide whether to remove a comment.

If need be, there are also bans: 3 days for lighter offenses, 14 days for bigger offenses, and permanent bans for people who don't show any willingness to participate productively. If we think the ban reason is obvious, we may not specifically write to you.

If you want to protest a removal or ban, feel free to write privately to the mods: @federalreverse@feddit.org, @poVoq@slrpnk.net, or @anzo@programming.dev.

founded 5 months ago
MODERATORS
 

Crosspost worldnews: The shadow banking sector is trying its hand at trading in debt-based products such as collateralised loan obligations

you are viewing a single comment's thread
view the rest of the comments
[–] 0x815 3 points 2 hours ago

They are not back, they have never been away. And it's not just the hedge funds but also the regulated banks that gamble with such risks (although the former hold much more assets).

There is a good analysis from May 2024. Among others, it says:

According to financial data at the [U.S.] Federal Financial Institutions Examination Council (FFIEC), as of December 31, 2023, JPMorgan Chase held $3.227 trillion off-balance sheet, of which $528.5 billion is undefined and marked as “other.” To put that in perspective, $528.5 billion is the size of the assets of the seventh largest bank in the United States and yet the public has no idea what the $528.5 billion off-balance sheet at JPMorgan Chase is made up of or what kind of risks it presents.

The article also deals with possible solutions. One major issue would be to prohibit deposit-taking banks from merging with investment banks, a measure that has been introduced in the U.S. as a response to the Great Depression in the 1930s and was ditched in the 1990s. The U.S. must urgently reintroduce such a law, and Europe and the rest of the world must follow.