Financial news - the collapse of Dexia
Dexia sank like a lead balloon once banks stopped lending to them A giant bank has just gone under. It’s the biggest bank failure since the debt crisis of 2008-2009. It’s so big, in fact, that its assets are actually LARGER than the total GDP of the country where it’s domiciled. The bank that failed is Dexia, and the country is Belgium. But if you don’t live in Belgium ... and you think that fact makes this failure less relevant to your banks or to your investments, consider these shocking facts: Shocking fact #1. Dexia was the world’s largest lender to municipal governments in the U.S. and overseas. So as the bank’s various pieces are chopped up and sold off to other institutions, it’s naturally going to be a lot tougher for municipalities to get financing. Result: More belt tightening and job cuts at local governments everywhere. Shocking fact #2. Dexia was one of many large banks that actually PASSED Europe’s official “stress tests” just three months ago. And ye...