Internet banking. A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith
Could you please explain again? :) Peak oil is not an energy crisis. It is a liquid fuel crisis.
Local banks usually seek to attract big depositors by promising higher interest rates for their savings accounts. Those depositors may have significant savings and yet be risk-averse and therefore only put their money on savings accounts. The goal of your company could be to provide those banks with the kind of investments that suit their risk-averse depositors. Afterall, what isn't a government guarantee worth these days? they should be easily convinced. Rien n'est gratuit en ce bas monde. Tout s'expie, le bien comme le mal, se paie tot ou tard. Le bien c'est beaucoup plus cher, forcement. Celine
So if I got it right my bank would find projects these local "private banking" banks would supply capital in the form of customer deposits for? And I would essentially use the deposits which really belong to the other bank to get (loaned?) capital with which I would then issue loans and keep my bank at a solidity of maybe 10-20 %...
Did I get it right?
By the way, would I pay the other bank a fee for using its depositors, or would the other bank pay me a fee for me finding investment opportunities for its customers? Peak oil is not an energy crisis. It is a liquid fuel crisis.
What I have been describing comes from a friend of mine who used to work at EDF in the securitization department from renewable energy projects. He gave me one of those files to take a look at, but I didn't take too close a look at it from the point of view of the bank.
I'm assuming the bank will have to get some money in the process, as what happens from its point of view is clients "leaving", as their money gets spent right away and therefore do not contribute toward their capital base and can't be invested somewhere else.
I will see this friend this week-end I think, so I will ask him some more questions and i will get back to you. Sorry for the cryptic writing, this is not my area really... Rien n'est gratuit en ce bas monde. Tout s'expie, le bien comme le mal, se paie tot ou tard. Le bien c'est beaucoup plus cher, forcement. Celine
That is, even if the savings are certificates of deposit, the commercial bank is going to be gaining funding short term and handing money over long term. For a bank with ready access to liquidity, its an income proposition, but for a bank who is nervous about its solvency going ahead and nervous about gaining liquidity when needed ... where is the liquidity?
Obviously if the relevant Government Reserve bank accepted units from one of these private infrastructure development banks as a repo lending asset, with no frown cost, and stopped accepting structured claims to structured claims to structured claims to rapidly dissolving piles of mortgages, or imposed a heavy frown cost on offering those types of assets for repo lending, there could well be a big push by commercial banks that happen to be liquid ... but other than that, I'm wondering. I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.
