Xmas

I've moved from one bubble to another - currently sitting at Vancouver airport, wondering how much debt each of these Vancouverites walking by me has. Probably rude to start canvassing this time of year, so I'll get to my info.

Spoke to a senior banking executive before I left and was given some interesting things to chew on throughout my flights - considering my lack of sleep I'll try and put it together in a coherent manner before I totally wig out and people mistake me for a crack-head, or being it's Vancouver - a guy who's just bought a crack-shack with mansion money.

The most interesting point, Commonwealth Bank and Westpac are looking to buy money 'hand over fist' at the moment to fund their existing loan books and both have slammed the brakes on lending - basically it's any excuse to turn down loans.

This ties in with another source who told me the banks 'have to roll over a large amount of debt next year.'

There's been a some Mexican stand-offs with large deposit customers. Some extracting their deposit rates at levels where banks aren't making anything on them, but the banks don't want the money to walk out the door.

Next was pointing out that CBA and WBC have outgrown NAB and ANZ to the point that the 'four pillars' term is no longer applicable. The new reality is 'two pillars, two stumps.'

Queensland is totally in the crapper (obviously).

He had no issue pointing out debt levels are way above where they were twenty years ago and a shift in interest rates causes bigger pain, so people in banks are well aware of this. As was mentioned, no one really wants to point out, it's the debt and not the interest rates.

Jeremy Grantham was mentioned and within banking circles is regarded as an alarmist - the official line. No surprise really, when a guy like that starts getting play the sheep herders start getting a little concerned the sheep will start making decisions of their own volition.

This will probably be my last post until the new year, unless I lose my mind and I'm back to proudly announce I'm the new owner of a crack shack. Gulp...

Merry Xmas!