9/14/2011 - Is Bank of America a Zombie?

This column highlights the most interesting and useful business and financial commentary from around the Web each day. Feel free to send along your own suggestionsfor blog content that you've read or written.

The Curious Capitalist
Link: Is Bank of America a Zombie?
"Early on in the financial crisis, economists warned that the biggest danger of the bailouts was that we would end up with zombie banks - institutions kept alive by government bailouts, but essentially doomed to rot away. Recent news about Bank of America (BAC) raises the question as to whether B of A has turned into a classic zombie. On Monday, Bank of America announced that it was planning on eliminating 30,000 positions in the next two and a half years. It is also expected to close as many as 750 branches. Does this make Bank of America a Zombie Bank?" (Take a look at, Did Fannie Mae Bail Out Bank of America?)

Felix Salmon
Link: France's Banks Lose Their Street Cred
"It’s looking increasingly as though the proximate cause of the next big global crisis is going to be a liquidity crunch at French banks, rather than a European sovereign default. This is not the kind of stock chart that any leveraged institution likes to see." (Also read, Can Europe Avoid the Sovereign Sequel?)

Credit Writedowns
Link: Grant Greece Default, Just Not Yet
"European equities reversed earlier losses after more supportive comments from EU politicians appeared to deflect the risk of a disorderly Greece default. Following the Franco-German conference call on Greece, French President Sarkozy’s statement that France will do everything to save Greece lent support to market sentiment. At the same time, finance ministers from Brazil, Russia, India and China are planning a meeting on September 22 to discuss capital involvement in the euro area, which appears to have mitigated somewhat the headwind effects of Chinese PM Wen’s denial of EU bailouts overnight." (For related content read, The European Economy and 26 Other Potential Disasters Making Investors Anxious)

Market Beat
Link: Apple: Watch the Throne, Here Comes Microsoft. Yes, Microsoft.
"To those of us who have spent years staring at blue screens of death and suffering through the XP experience, this may sound shocking, but apparently people are really liking the latest iteration of Windows. Somebody went so far today as to say it would make you throw out your iPad."

Free Exchange
Link: How Likely is Deflation?
"Just how likely is deflation? Odds of roughly 1:5 look pretty high at first glance and the FRBA’s methodology has its shortcomings. History provides an alternative benchmark in the base rate: the frequency with which the phenomenon has popped up on a historical basis. What is proportion of months that have been followed by a deflationary 5-year period?" (Also read, The Key to Economic Growth)


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