The traditional financial world is whistling and creaking. The Bank of England was forced this week to turn on its money printers in a total panic to bail out pension funds, and it now looks like the big Credit Suisse is collapsing.
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“A decisive moment”
CEO Ulrich Koerner Say Even the system bank is currently going through a “critical moment”. In a note to employees, Korner called on employees not to confuse the daily price movements of Credit Suisse stock with the bank’s strong capital base and liquidity position.
At the time of writing, the stock is hanging around its all-time low. The position of Credit Suisse forces the bank to undertake a major restructuring. It remains to be seen if that will help the bank in the end.
In general, the market is not lying, and Credit Suisse’s very low share price is a big concern for everyone, because the bank is on the list of systemic banks of the Financial Stability Board. Systemic banks are so important that if they fail, a domino effect can arise on the economy.
Regulatory Bank Credit Suisse
Credit Suisse is included in the list of the Financial Stability Board, along with 29 other banks. Banks include Morgan Stanley, Goldman Sachs, Deutsche Bank and ING Bank. If Credit Suisse really threatens to collapse, it must be supported to prevent the entire financial system from collapsing.
So it looks like we are entering a dark period. Ultimately, it remains to be seen whether central banks will actually succeed in keeping interest rates at relatively high levels for a longer period of time. If parties like Credit Suisse are really in trouble, it seems like it’s only a matter of time before they have to fix things.
Should Credit Suisse drop, this could potentially be dramatic for Bitcoin in the short term as well. This will undoubtedly lead to massive selling in the financial markets. If our leaders choose to keep Credit Suisse afloat with a capital injection, it could be a reason for Bitcoin to start to climb.
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