http://biz.yahoo.com/cnbc/080310/23557115.html


CNBC
Billionaire Investor Sees Bank Failures Ahead
Monday March 10, 10:52 am ET


Billionaire investor Wilbur Ross says the current market downturn differs from previous slumps in that no American banks have yet failed this time, but he suggests that's about to change.
"I think that's going to be the next wave, and coupled with problems in the commercial real estate market; I think they'll be the next bubbles that burst," the chairman and CEO of W. L. Ross and Company told CNBC's "Squawk Box" in an exclusive interview.

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He was asked about the risks to big banks.

"I think that the big banks won't fail in the sense that they will go to zero and depositors would lose money," Ross replied. "I think the Fed and other regulators will make things happen.| I think it's the medium-sized banks, and particularly some of those that got overextended with the subprime and other kind of mortgage debt.| I think those are the ones that had the serious mismatch, making 20- and 30-year loans based on 90-day deposits."

Ross's comments echo those made by Federal Reserve Chairman Ben Bernanke, who told a Senate committee on Feb. 28 that some smaller regional banks that heavily invested in real estate could go under.



Ross and other high-profile investors have made recent moves in the credit markets, explaining that they have done so to snap up bargains. Last week it was reported that Ross had invested $1 billion into municipal bonds.

In the meantime, Ross said he didn't think the U.S. economy would recover any time soon.

"I think at best we're in for stagflation," Ross said, referring to the combination of higher inflation and weak economic growth. "I think the consumer has been tapped out for quite a while and is frightened by the poverty effect of seeing the house go down."

Straightening out the problems in the bond industry, particularly the situation of the insurers who backstop bond offerings, would go a long way toward fixing the current paralysis in the credit markets, Ross intimated. That process is underway, he suggested, with the current reassessment by ratings agencies of the bond insurers.

"Making real triple-As will solve a lot of the problem," he said. "The problem is we've had a lot fake triple-As before."|



That effort is far from over, indicated New York State Insurance Commissioner Eric Dinallo, who has been at the center of efforts to stabilize the sector. Troubled bond insurers MBIA (NYSE:MBI - News) and Ambac (NYSE:ABK - News) successfully raised fresh capital last week, he noted. Now attention now turns to FGIC, he said, also during an appearance on "Squawk Box."(Read more here).



this coming from a man that has sent thousands of auto jobs to mexico....what does these people think we are going to buy their product with?

And Carnac predicts...

quote:

Originally posted by scooter_mech:

And Carnac predicts...

....Wilbur and his billions will be unaffected.

Things continue to worsen. This is not good at all.

Make sure your CD's and other Savings Accounts are FDIC insured !!!..

Oh, I love that phrase about getting "overextended" in the sub-prime market, as if it were an accident; like they weren't paying attention.

"Overextended" my azz. They got greedy and started writing what they knew were shakey loans, hoping to dump them off on investors before the buyers went belly up. Now, they're about to be stuck to their own tarbaby and, suddenly, it's a mere overextension, which justifies the taxpayers bailing them out.

This is a prime example of letting the government get involved in the economics side of society. If anything can by screwed up royal, let the government get involved. If you think health care is a mess now, wait till the government decides what health care you need. It would be outstanding if everyone could have their own house and property, but as in life, you have ignorant people and other waiting to take advantage of them. Now both the greedy and the ignorant are losers and we will all pay.

i felt i should clarify my remark about him sending jobs to mexico as to help you understand my finding his remarks as hypocritical,
"this coming from a man that has sent thousands of auto jobs to mexico....what does these people think we are going to buy their product with?"

a few years ago, wilbur ross purchased a vast majority of stock from lear corp, he suceeded in buying enough to take control of a lot of plants in the northeast and canada. right off the bat he wanted the workers to take a 40% cuts in benefits, those that did had a job, although at the end of their union contracts, he is prposing the cuts again or will shut the plant down and use it as a warehouse for products coming from mexico, those that didn't take the cuts, got sent to mexico within a year.
so i find his remarks hypocritical and blame people like him for the shape this country is in, they come in , buy factories, force people to take wages half of what they are earning, if they don't take the cuts, they eventually move them to mexico, i may be wrong, but, it's just the way i see it from here