Royal Bank of Scotland warns the world that the S&P can have a 10 handle by September. Morgan Stanley warns us that the ECB and the Fed are on a collision course, and that the consequences are dire. And Bloomberg reports that John Paulson says that we are headed for $1.3 trillion of writedowns:
Paulson & Co. Head Says Credit Writedowns May Hit $1.3 Trillion
By Poppy Trowbridge and Tom Cahill
June 18 (Bloomberg) -- John Paulson, founder of hedge fund Paulson & Co., said global writedowns and losses from the credit crisis may reach $1.3 trillion, exceeding the International Monetary Fund's $945 billion estimate.
``We're only about a third of the way through the writedowns,'' Paulson said, speaking at a hedge fund conference in Monaco today. ``There are a lot of problems out there and it will continue to be felt through the year. We don't see any signs of stabilizing.''
Paulson, 52, whose company Paulson & Co. manages about $33 billion, returned 12 percent in his Advantage Plus Fund through May, according to investors. Last year, Paulson's Credit Opportunities Fund climbed almost sixfold. He has been betting on an increase in corporate defaults and a slowdown in the U.S. economy as home prices and consumer-spending to decline.
And now we have more rumours on Lehman batting clean-up!