I did a small research. While according to Steve Eisman, after the government bailout of banking industry in 2008 after the sub-prime crisis of housing loans in US of A, banks in America including Bank of America reduced their debt-equity ratio to a leverage of 10 percent followed by 6 percent in Switzerland and 10 percent in UK. According to Steve Eisman, leverage is bad. Why bad, more leverage, more risk, more money you make.
That doesn't explain 50:50 debt equity ratio of ICICI Bank, 79 percent leverage of Canara Bank, non-performing assets of Banks and 83 percent Shareholding of single investor Government of India in Bank of India.
Well, in America, the banks were bailed out only after the crisis. In India, Indian Government is the Kapil Dev (Former World Cup Winning Captain of Indian Cricket Team) of Banks with 83 percent shareholding in most Indian Government Banks and Banking Staff being direct or indirect employees of India Government. Steve Eisman freaked out at CDO's in "The Big Short".
India government simply says we are here to protect the squint that is schizophrenia of the average indian household member.
IT IS GONNA BE ALRIGHT. IT IS GONNA BE ALRIGHT. IT IS GONNA BE JUST FINE. HEY HEY HEY ALRIGHT.
Each one Teach one!
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