The New York Times recently undertook a 2 hour interview with Citigroup executive Robert Rubin, and asked the obvious question of the former Goldman supremo (and US Treasury Secretary) - 'How come you didn't see the current market difficulties coming, and why didn't you position your company to avoid the worst of the turmoil ?'.

Rubin replied: 'By the time I finished at Treasury, I decided I never wanted operating responsibility again.....People know I was concerned about the markets. Clearly, there were things wrong. But I don't know of anyone who foresaw a perfect storm, and that's what we've had here'.

Bloomberg reports that Fitch has cut Barclays' long-term debt rating to AA, citing 'earnings and risk volatility' at securities unit Barclays Capital. The news agency also quotes Credit Suisse Chairman Walter Kielholz, who said: '2007 was an extraordinary year for our industry. In some respects 2008 looks set to become at least as challenging'.

The news agency also reports that, according to a note from JPMorgan analysts, banks in Europe (excluding the UK) are thought likely to have to writedown an additional $10.8bn of assets this year. The estimate is down from around $13bn mentioned in a previous note. Credit Agricole, Deutsche Bank and Societe Generale are still thought likely to writedown the most among the top firms.

Reuters reports that Deutsche Bank is said to be offering a discount of up to 9% to investors willing to take loans made to finance the LBO of Alliance Boots off its hands.

The news agency reports that Sandford C. Bernstein analyst Brad Hintz has said that Merrill Lynch could face a credit rating downgrade later this year. Hintz says: 'With earnings depressed, the economic environment weakening, troubled CDOs frozen on a balance sheet, hedging roll risk still high and equity stretched, we believe there is a strong chance Merrill will face a credit downgrade this year'.

Finally, The Wall Street Journal reports that Daiwa Securities has posted a $123.8m loss for the 3 months to March 31st, on fixed income losses caused by the credit crunch. And Reuters reports that Mizuho Financial Group has confirmed that it will now delay the merger of its brokerage unit with Shinko Securities until May next year, by which time it should have sorted out its own subprime lending woes.

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