Banks prepare for the impacts of sovereign debt write offs in Europe
We are getting closer to the dose of reality in Europe, and it is becoming abundantly clear why it is taking Germany and France so long to decide. Once you start looking at write offs of 60% it is s slippery slope to a) more than 60% on the thinking that can Greece even repay the 40% remainder, and b) write offs for other Euro countries.
The financial effect is to raise the amount required to $252 Bn versus the $109 Bn predicted earlier.
For impacts to consider, here are a couple of earlier posts. There will be knock on effects in North America. Remember the largest holders of Euro sovereign debt are banks.