October 3, 2008
Commercial banks stand to profit from Black Monday, economist says
With Congress’ passage of the bailout package today, the turmoil on the stock markets has subsided just a little. The question now is, are there any winners in this situation? The answer, according to CanaData chief economist Alex Carrick, is “yes, indeed.”
According to Carrick, the commercial banking industry is poised to benefit from the “flight to security,” as wary investors put cash into commercial savings accounts and GICs.
“The commercial banks are reaping a bonanza in cash deposits,” says Carrick. “In fact, there may be a double benefit to the bank from the stock-market activity, since any purchase transactions will also involve a great deal of borrowing on the part of credit-worthy buyers.”
Read Mr. Carrick’s compete analysis here: "Huge Potential for Commercial Banks from Black Monday."
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