Time to face the music

摘要

On August 8 2007, BNP Paribas, France's biggest bank, halted withdrawals from three investment funds because it couldn't, so it declared, "fairly" value their holdings after US subprime mortgage losses. It was, most market participants would agree, the admission that marked the beginning of the global financial crisis from which we have yet to fully emerge. Sure, the global economy is growing again, banks' balance sheets - in as much as they are transparent to the casual observer - have been restored to something approaching health, and stock markets are making new highs by the month, if not the week. And yet, among more seasoned players, there is a deep sense of discomfort. Fed Funds at near zero, the ECB's main refinancing rate at 0.05%, the UK's base rate at 0.5% and the BOJ's overnight call rate at 0.1%? None of them look right -or, at least, don't feel right.