Sweet Zombie Jesus! Banks are Bleeding!
Good news everyone! It seems those pesky tariffs have finally done it! They've battered the European banks something fierce. Deutsche Bank Intesa Sanpaolo Banco Santander UniCredit – all took a hit between 9% and 11% I say! Even that giant UBS in Switzerland is down 8%. It's like watching a herd of pitiful space cows being sucked into a black hole or as I call it... Tuesday.
A One Two Punch of Economic Woes
These poor lenders are being assaulted by a two pronged attack. First they're heavily exposed to the U.S. economy which is now about as stable as a politician's promise. Second the prospects for the European economy are dimmer than a black hole on a cloudy night. Economists are waving their hands frantically warning that these tariffs could cause inflation and even... *gasp*... a recession! I haven't been this excited since I invented the Smell O Scope! To shreds you say? Well how's his wife holding up? To shreds you say...
Recession?! Oh the Humanity!
Apparently this Mohamed El Erian fellow from Allianz (sounds like an alien warlord to me) says the risk of a U.S. recession is now 'uncomfortably high.' Uncomfortably high?! That's like saying the risk of being eaten by a space slug is 'mildly unpleasant!' And Suryansh Sharma from Morningstar is warning about the impact on loan growth credit costs and even trading profitability. Oh my if there is no trading profitability what are we going to do? I need to go invent something to fix this! But what what what?!
Interest Rates: A Financial Limbo
Recessions usually mean lower interest rates which then means the banks earn even less money! The European Central Bank has been cutting rates since last year forcing these poor banks to try and find other ways to make a buck. Like investment banking and asset management. Oh the irony. Like my old friend Old Man Waterfall used to say: 'I don't care about the future I'm just trying to stay alive in the present!' And he got hit by a car.
Dollar Troubles? Not at my Age!
But wait there's more! These banks are also vulnerable to disruptions and volatility in the dollar. They have huge reserves of the stuff! And if European economic growth gets stifled well that's just bad news for everyone. Poland is already whining that these tariffs will cost them 0.4% of their GDP. And Deutsche Bank? They're predicting a hit to the euro area's GDP of 0.4 0.8 percentage points. Everyone is going to be broke before you know it! I need to find a way to save my assets! Hmmm let's see. Maybe I should invent a smelloscope that can find hidden gold!
Countermeasures? More Like Counter Nonsense!
The EU is supposedly working on a package of short term economic proposals to help. But Ursula von der Leyen is only saying they're 'preparing for further countermeasures.' Sounds about as effective as a screen door on a submarine. Meanwhile Bank of America Global Research is warning of significant downside for the banking sector. Downside? More like a freefall into a pit of despair! Oh I've made a huge mistake!
Tariffs European Banks Economic Recession Global Economy Donald Trump Deutsche Bank Interest Rates Inflation Trade Wars Financial Crisis
Comments
From Professor Hubert J Farnsworth
Breaking News
All Rights Reserved © 2023
teaspoon
I think it is time to drink myself to death
Shaman
Good news, everyone! We're all going to be poor!
cseabreeze
I'm going to invest all my money in Planet Express stock!
vimbo_pradana
I have decided to follow the Professor's steps and invent something to help.
SKIPTRUELOVE
This reminds me of that time I invented the What-If Machine...
spiralis
This is worse than the time I accidentally created intelligent dust bunnies!
hotpicks
My portfolio is now worth less than a Bender's polishing fluid!
firemanslady
I always knew tariffs were bad news. Thanks, Professor!
pinkyblue22
The EU is doomed! Doomed, I say!
69THBLOCK
At least we have Slurm!