74.5.

74.5. I posted here about a study by Credit Suisse that concluded that with the exception of Goldman Sachs, none of the biggest banks “would have consistently made returns much above the cost of their capital before the crisis had they been forced to limit their leverage to sane levels.” American banks at the beginning of the financial crisis had a leverage ratio of 30 to 1 and some European banks were as high as 80 to 1. I posted here on a John Lanchester article in 2008 (three years ago!) which marveled at the leverage ratios of banks. Barclay’s was at 61.3. Lanchester asked what you would do if you could borrow 60 times your assets. He said that he would buy an island. The biggest banks were the ones that were too big to fail. Anne Jolis in the Wall Street Journal (October 6) told about how she had made a telephone call to Dexia, a Belgian bank that is too big to fail, but is being bailed out for the second time in three years. She has a lot of her assets with Dexia. She asked about Dexia’s leverage ratio of 74.5 as of June 30. And she asked about some of Dexia’s assets which look dicey. For example, they have 17 billion euros in Greek and Italian sovereign debt. The bank assured here that everything was going to be fine.