United States Federal Deficit Graph

As you can see in the graph the U.S. federal deficit has not been this small since 2008. This might seem surprising since 2008 was the year with all the major bank failures. Yet it is quite likely that the (long lasting) recession of 2009 created a lot more costs for the government than those bank failures. The current recovery is seen in the outlays as well as in the revenues.

NY Times

International Bank Exposure To Russia

In the last quarter of 2014 total bank exposure to Russian debt added up to 242 billion dollar. Banks in France, the United States and Italy were leading in exposure. Most money is lent out to the non-bank Russian private sector.

Reuters Jamie

Leverage ratio versus capital ratio in the United States

The blog Capital Issues made a graph comparing leverage capital ratio's with risk-based capital ratio's for U.S. banks. A leverage ratio measures the capital of a bank compared to it's total assets, while the risk-based capital ratio's measure the capital compared to the risk-based assets. In the latter measure different assets are weighted differently based on their risk, as set by regulation rules. The graph shows the top of the leverage curve left to the top of the risk-based curve. Also there are a lot more banks with high risk-based capital ratio's under the risk-based measure.

Capital Issues

Banking Sector: Percentage of GDP Across the World

This chart shows the banking sector in terms of assets as a percentage of GDP forcseveral continents. What stands out, are the extremely large banking sectors in European countries.

ZeroHedge

EZ Banking Sector As a Percentage of GDP (2000-2013)

This great chart by Thomson Reuters shows the Euro Zone bankings sectors of their respective countries GDP. With Luxembourg leading with a big gap, Ireland and Cyprus follow. Slovenia and Greece have notably small banking sectors.


Click on the picture for a bigger version.

OECD Direct Fiscal Costs of 2008 Financial Crisis

This chart shows the direct fiscal costs for the financial crisis in OECD countries between 2007 and 2009. Especially Ireland and also Iceland stand out as having relatively high costs in those years relating to the crisis. Notably the Netherlands is third and USA only comes in on the eight spot.

Banks Bring Money From ECB To ECB

Last month the European Central Bank lowered the bechmark interbank rate from 1 percent to 0,75 percent. The lowest interest rate to date, since the creation of the Euro. Together with this the deposit facility was lowered from 0,25 to 0 percent. All the billions of dollars that the banks with excess money held at the ECB where not getting any interest anymore. As you can see in the graph the deposits at the ECB, held by the banks, lowered dramatically when the ECB stopped giving interest.

It seems the banks moved their money to the current account of the ECB, shown in the next graph. The banks don't get interest with their money at the current account, but it's more convenient than the deposit facility. Since, in contrast to the deposit facility, banks don't need to move their money to the ECB every day at the current account.

Biflatie

Financial Markets Reaction to the Euro Zone Bailouts

Reuters made these great graphs which give an overview of the market reaction to the Euro Zone bailouts. The following indicators are shown: euro/dollar, Euro Zone banks, Euro Zone government banks and Euro Zone equities.

Reuters

ECB Lending to Italian & Spanish Banks

As you can see the lending of the ECB to Italian and Spanish bank spiked recently to new records. Spain's banks already needed more help during the banking crisis and the Great Recession, and is also currently the country which needs the most help from the ECB. It is noticeable that also Italian banks need significant support, because the private sector in Italy by far has not been hit as much as compared to Spain.

Share Prices Of Banks in Japan, U.S. and EU (1980-2012)

You can see the share price of the banks (average) for Japan, U.S. and the EU between 1980 and 2012 in this graph. Japan saw the bank shares rise dramatically during the share and housing bubble of the 1980's. Japan's bank shares didn't enter in the Dot com bubble as for the European and especially the banks in the United States. As you might have expected, bank share prices are currently a lot lower than before the crisis.

Reuters

Euro Zone Bank Depositis (2009 - June 2012)

This graph shows the change in the Euro Zone bank deposits, with start of 2009 as 100. You can see the bank deposits decline especially in Greece and Ireland, already from the end of 2009. Lately this started also to happen in Spain. Italy is still quite stable. France and Portugal saw their deposits rise especially, in contrast to the lower rise in deposits in Germany.

Reuters

Target2 (im)balances in the Euro Zone (end of 2011)

In this post you can see the Target2 balances in the Euro Area. Target2 is the payment system in the Euro Zone that makes sure payments can be easily made between residents in the various countries. When a customer of a bank wants to transfer money to a bank in another country, the bank in the home country can send the money to the bank abroad if it sends an asset as well. The foreign bank would not accept the money alone, because the savings will show up as an liability on its balance sheet and its balance sheet would need assets by the same amount to remain in balance.

There are many ways for the home bank to do this. One way for the home bank is to borrow the corresponding asset at the central bank in the home country. The central bank would then borrow the amount from the ECB (incurring a more negative Target2 balance), the central bank in the foreign country will complete the transaction to lend the amount from the ECB (incurring a more positive Target2 balance), to give the asset to the bank which recieved the transferred money. As you can see on average this process occured more from southern countries to northern countries. This shows the capital outflow from the PIIGS countries, which could be of great concern.

Target2

Collapse of the Euro Zone Banks

This chart shows the market value of all the shares of the banks in the Euro Zone, as a percentage of total shares of all the companies listed on the stock markets in the Euro Zone. The share (%) of the banks collapsed from a top in 2007 to a close to historical low in 2012.

Thomson Reuters

Rapid Declinie in Greek Deposits

This graph from Thompson Datastream shows the Greek private sector deposits over the last 20 years. Light brown shows the household + business deposits and the dark brown shows only the business deposits. Clearly the households have been the main driver in bringing down the deposits by huge amounts in the last few years.

Thomposon Datastream

United States Sectoral Balance Sheets (1985-2012)

As you can see running up to the crisis households massively increased their borrowing. The government also had substantial deficits in the nineties and after the millennium. The corporate sector was on average almost in balance. Since the crisis a dramatic increase in savings by the private sector made the public sector increase its deficit.

Richard Koo

Spain Sectoral Balance Sheets

Households (since 1997) and the corporate (since 1999) sector massively increased their borrowing. A big part of the financing of the increased borrowing came from the rest of the world that increased it's savings in Spain by a huge amount. On the contrast the Spanish government decreased spending dramatically. During the crisis the government had to step in because of the high rise in private savings (and lower consumption and investments).

Richard Koo

Sectoral Balance Sheets Euro Zone

This chart from the OECD shows per sector the net lending/borrowing for the Euro Zone. As you can see the household and the financial sectors are net lending sectors and the non-financial corporations and governments are net borrowing sectors. This means for example for the households that they save more than they borrow for a sector as a whole. This doesn't mean that the borrowing of the households doesn't increase on the other hand.

The total economy shows the net lending/borrwing of the total Euro Zone economy. In  other words when the Euro Zone as a total economy is borrowing, it borrows from the rest of the world, which was the case before the crisis.

Before the crisis households en companies increased their borrowing notably. Since the crisis households and companies started do pay off their debt. Although as you were able to see in other posts this is a long process. The lower demand by the households and the companies was accommodated by an increase in government spending (higher borrowing).

OECD

Italy & Spain Main Users First LTRO

This graph from a BIS report (European bank funding and deleveraging) shows on the left for which amount in billion euro's banks of the countries in the Euro Zone have used the first 'Longer Term Refinancing Operation' 3 year loans of the European Central Bank. 

The second graph shows how the banks have changed their holdings of government debt in the three months after the LTRO. It seems Italy and Spain have used the LTRO money partly to buy government debt. As seen by the large decrease in the interest rates of the government bonds of these two countries in the given period it is most likely the bonds that the banks bought were Spanish and Italian.

Wall Street Compensation 2007-2010

Small graph showing the compensation and benefits at Wall Street. As you can see compensation stayed about the same during these four years. In nominal values the compensation was only declining in 2008 (127 to 112 billion dollars), in relative values in 2008 (36,2% to 33,1%) and 2009 (33,1% to 31,15).

Click on the source to see the compensation specified by type of financial firm.

Source: Wall Street Journal

Bailout & Stimulus In The World During The Financial Crisis

This infograph shows the sizes of the bailouts and the stimulus (up until the end of 2009) in the world. The grey circles picture the size of the economy of the country in 2008 in dollars. Inside the circle the red part shows the bailout costs as a percentage of GDP and the blue part shows the stimulus amounts as a percentage of GDP.

The Big Picture