It seems Wall Street doesn't like the idea of nationalizing the banks
Fears of a nationalisation of Citigroup and Bank of America shook global markets on Friday, sending shares in the troubled banks tumbling and dragging down the entire financial sector.
It emerged that the US government is to begin its planned “stress tests” of banks’ financial health, which Wall Street executives told the Financial Times could start next week.
Gold prices broke the $1,000 a troy ounce barrier, the highest level in 11 months, as investors shunned risky assets for the relative safety of bullion amid renewed fears about the health of the global financial system.
“Gold investors hear ‘trillions and trillions’ and ‘bail-out after bail-out’ and look at gold as the only asset good for capital preservation,” said Tom Pawlicki, of commodities brokerage MF Global in Chicago.
But is it really the fear of nationalization per say or the fear the banks are insolvent?