I'm going to repost my August 6th entry, as follows:
"If I may point out the obvious, the spectacular growth that Cascade Bank enjoyed for a few years came from risk-taking. The spectacular collapse of Cascade Bank came from risk-taking. Any questions?"
Rinse and repeat.
If it doesn't sound too mean, this disaster was coming for years before anyone noticed. They were living high, but I recognized the signs. "Business is up, so I must be a genius. Business is up, and I deserve big bonuses and lots of glowing press."
No, business was up because you were 'all in' on a bubble. Never go 'all in' on a bubble.
I don't know anything about the legal terminology, but 'cease and desist' sounds an awful lot like, "Quit putting out information that is slanted toward the positive and get real."
Trouble is, the real isn't real pretty. Who wants to buy toxic loans? Does anyone really believe their loan portfolio is going to suddenly start performing better? The commercial loans are just now starting to kick in, and if anything, they may be worse than the housing loans.
If I'm right that the FDIC is asking for greater transparency, they are going to have to admit to a situation that is worse than they have up to now admitted, at the same time trying to raise money from investors and depositors.
Increase deposits? I'll be willing to bet there are people pulling out their money as we speak (write). They don't have to -- it's ignorance -- but it's a human impulse, either to protect the money or to avoid hassles. Their stock is down 6.72% today as I write this.
4 days ago