Jump to content

Global bank bailout – Here we go again?

Recommended Posts

SVB, Signature, Credit Suisse, First Republic … it all sounds familiar. Shard Capital’s Bill Blain tells IG’s Angeline Ong why this could be the start of another global bank bailout and where investors can head to find cover.

 Angeline Ong | Presenter, Analyst and Content Editor, London | Publication date: Friday 17 March 2023 

Cut out the noise

Ong: Bill, thank you so much for joining us. There's been so much going on out there. First SVB, then the central banks and the markets and now more news of rescues coming out of the US. What's the real story here?

Blain: Listen, we're back in one of these extraordinary market situations, which basically boils down to almost like a war between the forces of chaos, which is people panicking about how markets are going to develop and the forces of stability, which are the central banks trying to engineer that stability by persuading the market that the banking system is stable.


Blain: So as this banking crisis really comes to fruition, we've seen a number of skirmishes. The collapse of Silicon Valley Bank, I would say, is just a skirmish. It was quickly addressed by banks backstopping every depositor and providing liquidity. And then, of course, we had the extraordinary thing of Jamie Dimon, the head of JP Morgan, leading $30 billion of Wall Street's finest and try and rescue another ailing bank, First Republic Bank. At the same time, we've got this incredible story going on around Credit Suisse Group AG (CH), where the Swiss National Bank, and I'm sure together with the European Central Bank, managed to put together a very quick backstop plan to provide them with as much liquidity as needed. And at the same time, Christine Lagarde, the head of the European Central Bank, went out there and I would say courageously decided to go ahead with a 50 basis point hike by the ECB at a time of market tension to demonstrate just how safe and secure the system was.

Bond markets next?

Blain: At the end of the day, it's all a bit of a game. It's central banks trying to persuade us there's nothing to worry about. Then, it's the doubts of the market about just how badly damaged the rise in interest rates has hit the bond markets, therefore leaving massive holes in the real numbers that underlie banks. I'll be very happy to talk about just how much damage has been done to the bond market.

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • General Statistics

    • Total Topics
    • Total Posts
    • Total Members
    • Most Online
      10/06/21 10:53

    Newest Member
    Joined 24/03/23 16:01
  • Posts

    • Charting the Markets: 24 March The FTSE 100, DAX 40 and Nasdaq 100 slide on renewed banking woes while EUR/USD, EUR/GBP and GBP/USD drop as the US dollar, gold appreciate due to flight-to-quality flows. Crude oil and copper tumble on recession fears.  Axel Rudolph FSTA | Senior Financial Analyst, London | Publication date: Friday 24 March 2023         This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.  
    • Market Breakdown | WTI Oil, EURUSD, GBPNZD, EURAUDHere are the updates & outlook for multiple instruments in my watchlist.1️⃣ WTI Oil daily time frame️The market is trading in a long term bearish trend .After the last sharp bearish movement, the market is steadily recovering.Ahead, I see a major horizontal supply area.Probabilities are high, that the next bearish wave will initiate from there.2️⃣ EURUSD daily time frameAfter a breakout of a solid daily resistance, the market is preparing for its retest.Watch carefully the underlined zone and look for buying opportunities from there.3️⃣ EURAUD weekly time frameThe pair is currently approaching a weekly horizontal resistance cluster.Taking into consideration, that the pair is quite overbought, probabilities will be high to see a pullback from that4️⃣ GBPNZD daily time frameThe pair is currently retesting a broken neckline of an ascending triangle . As we discussed earlier, the trend line of a triangle and its neckline compose a contracting buy zone now.Chances will be high that the next bullish wave will initiate quite soon.For Additional confirmation use: Divergence Indicators
    • #CHFJPY: Classic Bearish Setup 🇨🇭🇯🇵   🔻CHFJPY has nicely respected a confluence zone based on a horizontal 4H resistance and a 0.5 retracement of the last bearish impulse.   The price formed a double top pattern on that and broke its neckline.   Probabilities will be high that the pair will drop lower soon. Goals: 141.172 / 140.363  
  • Create New...