Quote Originally Posted by Watcher In The Middle View Post
Good timing (or maybe, poor), depending upon one's outlook.
Hey Watcher,

I would go with most likely poor for the investors/traders caught in this event, but positive for the rest of the financial system.

Why?

IMHO our/the western political class has cravenly passed on exercising their duties to ensure that the market is able to kill unsustainable enterprises before they became to big to fail, and now the only way left is via nationalization. Voters are also part of this in that we have not exercised appropriate supervision and due diligence of those we have elected. Perhaps Monsieur Hollande will take the opportunity given and do the right thing?

Hopefully his econ team can ensure that the nationalization, breakup, and sale of the remaining assets is a case study in how to repay taxpayer funds plus interest.

Hollande Names Pierre Moscovici As French Finance Minister, By Helene Fouquet and Mark Deen - May 16, 2012 12:33 PM MT Bloomberg News

The young Moscovici started in politics as a supporter of the Communist Revolutionary League and left it in his late twenties for the Socialist Party, where he steadily rose to become one of its leaders and a specialist of European affairs.

Moscovici, like Hollande, studied at France’s elite Institute for Political Sciences and Ecole Nationale d’Administration in Paris. After working for the Socialist Party for several years, he ran for deputy in 1997 in the eastern Doubs region.
Hollande also named Michel Sapin Labor Minister, Laurent Fabius Foreign Minister and Manuel Valls Interior Minister. Jerome Cahuzac will run the budget ministry. For the first time, the French government will have an equal number of men and women in its cabinet, Ayrault said.
You might also remember the recent case of Dexia...France has a significant piece of the the liability associated with that failure as well.

Dexia, from Wikipedia, the free encyclopedia, http://en.wikipedia.org/wiki/Dexia

Dexia N.V./S.A., also referred to as the Dexia Group, is a Belgian-French financial institution active in public finance, providing retail and commercial banking services to individuals and SMEs, asset management, and insurance. The company has about 35,200 members of staff and core shareholders' equity of €19.2 billion as at 31 December 2010, and provides governments and local public finance operators with banking and other financial services. Asset Management and Services provides asset management, investor and insurance services, in particular to clients of the two other business lines. In 2008, the bank received bailouts for €6 billion, and it has become the first casualty of the 2011 European sovereign debt crisis. Negotiations are taking place for its breakup.[2] Its headquarters are in Saint-Josse-ten-Noode, Brussels.[3]
Fortis is a 2008 casualty worth looking at.

Fortis (finance), from Wikipedia, the free encyclopedia
http://en.wikipedia.org/wiki/Fortis_(finance)

Fortis N.V./S.A. was a company active in insurance, banking and investment management. In 2007 it was the 20th largest business in the world by revenue[1] but after encountering severe problems in the financial crisis of 2008, most of the company was sold in parts, with only insurance activities remaining.

The Benelux countries were Fortis's home base and its strength. Fortis's banking operations included network (retail), commercial, and merchant banking; its insurance products included life, health, and property/casualty lines. Products were sold through independent agents, brokers and financial planners, and through branches of Fortis Bank. It was listed on the Euronext Brussels, Euronext Amsterdam, and Luxembourg stock exchanges.

The company was broken up after having critical difficulty financing its part of a joint acquisition of ABN AMRO (as a member of a consortium which also included Royal Bank of Scotland Group and Banco Santander). After receiving a bailout from the Benelux governments, its Belgian banking operations were sold to BNP Paribas, while its insurance and banking subsidiaries in the Netherlands were nationalised by the Dutch government and renamed ABN AMRO. The Dutch insurance arm of Fortis was split off as ASR Nederland.[2]

Fortis retained the rest of its insurance operations (remaining the largest provider in Belgium),[3] and changed its name to Ageas in April 2010, with ownership of the Fortis brand having passed to BNP Paribas.[3]
@ Fuchs,

The Great Depression was an example of relatively quickly clearing the market of malinvestments while Japan's 'Lost Decade' is an example of a more controlled clearing process.

Tough choices either way...