Wall St. NY Could Blow, Bronx

Hey Bronx, wake up to the fact that Wall St. could blow, banks and all.  The Guardian and Wall Street

Journal both warned, today, that the European interbank market has frozen up,

with banks panic-hoarding their cash in fear that one or more

major European banks are about to go under. The Journal reported

that banks are turning to the U.S. for overnight lending from the

Fed's discount windows, further confirming reports that President

Obama had assured German Chancellor Angela Merkel last month that

the U.S. would continue to be the ``lender of last resort'' for

the European Monetary Union.

The reality is that the entire trans-Atlantic banking system

is in a meltdown right at this moment. One senior U.S.

intelligence source reported this morning that the ``Big Six''

too-big-to-fail Wall Street banks have between $1-1.5 trillion in

exposure in Spain and Italy alone, and that it is no longer

possible to separate out the banking collapse in the United

States from that in Europe. The same source confirmed the

freeze-up of interbank lending, blaming the freeze, in large

measure, on the belief that the Spanish banks, led by Santander,

are in the greatest danger of immediate default.

Bernanke and Geithner know, the source concluded, that they

have to go for QE3 right away, but they don't even dare raise it

at next week's FOMC meeting, because the opposition is so fierce.

There are one million new foreclosures already in the pipeline,

delayed by the scandals. All told, there are 4.5 million more

foreclosures coming; the banks cannot make up for these losses

by charging exorbitant fees to their depositors. We have reached

a break point, he concluded.