H/t reader squodgy:
“How do I pay for my next bag of crisps?”
BANKS are preparing for the worst in the second half of the year as it faces an ‘economic nuclear winter’, a major investment bank expert has warned.
A series of political shocks – including Britain’s vote to leave the EU – have led to fears the entire Union could crumble, the currency could collapse and economic nightmares could become a reality.
Now it has been revealed this kind of “economic nuclear winter situation” is being prepared for by major banks.
Weak corporate earnings, a banking crisis, and the Brexit vote have sparked disaster planning for the worst case scenarios in the second half of the year.
A major lender told CNBC: “This could mean triggering Article 50, a referendum in other European nations leading to a break-up of the euro or sterling hitting below $1.20 or lower.
“The banks are ready for anything now.”
After the United Kingdom voted to leave the European Union in June, there have been talks a similar referendum may be held in France, the Netherlands and other countries.
The source added: “Markets hate uncertainty and the events this year have unfortunately created a lot of mystery around what is going to happen next.”
Shares in the biggest banks have been plummeting in recent weeks putting weight behind what, months ago, would have been seen as wild predictions.
Deutsche Bank has lost almost 45 percent, Credit Suisse has lost 41 percent and the Royal Bank of Scotland went down 35 percent in 2016.
Uncertainty and volatility has been spotted in all areas of the economy from mining to car production.
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