Global financial system implosion begins
- Thread starter Falcon
- Start date
The Global Financial system was my are of lurk for a long time, despite my principled misgivings about it at nearly every step of the way, but we all prostitute ourselves to the highest bidder most of the time...
Ive done Barings/LCTCM/Enron/Sumitomo/Dot com/ Gulf War 1 & 11 ...blah blah blah
Some of it was right in the thick of the action, so to speak, coal face / front line / firefighting blah blah blah
Every time something like this popped up, there was a real feeling of excitement in me that this could be where things actually change for the better. Every single fuckin time.I was looking at hundreds fo millions of quids of unrealised losses on the books (secretly grinning away whilst people around me were having breakdowns)
they never did change permanantly
I'm sad to say, I dont think they ever will
sorry to piss on the thread chaps
Ive done Barings/LCTCM/Enron/Sumitomo/Dot com/ Gulf War 1 & 11 ...blah blah blah
Some of it was right in the thick of the action, so to speak, coal face / front line / firefighting blah blah blah
Every time something like this popped up, there was a real feeling of excitement in me that this could be where things actually change for the better. Every single fuckin time.I was looking at hundreds fo millions of quids of unrealised losses on the books (secretly grinning away whilst people around me were having breakdowns)
they never did change permanantly
I'm sad to say, I dont think they ever will
sorry to piss on the thread chaps
citydreams
on the road again
Aye, it amazes the shit out of me that leaders of western world countries are more afraid of the consequences of a Tobin Tax than of hyper inflation.
elbows
Well-Known Member
Yes. But not any that would avoid a nasty recession and suchlike. Just obvious things that the masses should try to come to terms with, in order that the transition to a more sustainable system happens.
Most of it depends on the extent of the collapse, and whether any groups come along and claim to be able to give people back the lifestyle they've had over the last few decades. And whether there is international cooperation, or war.
So things like being psychologically prepared, coming to terms with the return of many things to being genuine luxuries, rather than things we take for granted. Applying cynicism to the right things, like parties that have reactionary solutions or want to scapegoat to blame, and being prepared to discard at least some cynicism about actions that government takes. eg I expect that the government will eventually be forced to do all sorts of things I actually agree with, and this will not be something Im used to.
Oh I dont know, there are so many variables, I already predict things that I cant really be sure of. So much depends on how fast we have to transition, and whether we go off on any more fruitless quests to tackle the problem in the wrong way, wasting years.
I would not expect government to sit by and let everything collapse, and on this note I have two conflicting concerns. On the one hand I worry about whether democracy will survive (or even become more democratic), on the other I worry about the sorts of parties that may gain wider support in troubled times.
On a more practical note for what people can do, the energy saving agenda is a big part of it, along with better cooperation between people, and people returning to a slower pace of life without becoming too bored, depressed or agitated.
Of course events which are not too easily influenced by the masses may go down in such a way that we do not have much opportunity to do our bit. Or there may be one moment where we are at a crossroads and how the masses act will make all the difference to the path we take, and the wrong one is taken, which will be tragic.
In the short term, the economy is always quite driven by peoples sentiment. We could of had the economic woes of the last year, quite a number of years ago, if everyone back then had decided to get gloomy about the future, house prices, and other prospects for the future. Instead governments, business & a big chunk of the masses decided to carry on regardless, and not think the unthinkable. That seems to be coming to an end, and there could be a rush in the opposite direction that is too strong (as we see with boom & bust, bull & bear markets, tend to go to extremes).
What? Like in New Orleans?
I just noticed this:
LinkClub of Rome said:
That was four years ago.
Now India, China and a load of other hopefuls are busy playing catch-up capitalism, in search of the easy consumer life.
I fear they are going to be disappointed.
david dissadent
New Member
We have an answer.
IndyMac has been taken over by the FDIC. Federal Deposit Insurance Corporation. They have actualy made some pretty big loans to IndyMac. Now they have egg on there face, they have taken.....
http://www.ots.treas.gov/docs/7/778029.html
They have had to take over the bank as it not longer can meet depositors obligations. The timeline is that like countrywide (mortgage lender), Thornburg(mortgage lender), Ambac (bond insurer), MBIA (bond insurer), Lehman (investment bank) and the late and unlamented Bear Sterns (investment bank): IndyMac has been on a list of financial zobie corps for a while now. Corperations that have failed bussiness models and the people who have been watching this crisis are awaiting them to fail. Since the credit crunch went public in August last year there have been very serious questions over Indymacs business model, in that it had a huge amount of its portfolio in California, one of the bubble states, and especialy in the Alt-A and Option-ARM markets, that is markets that are going to go horribly wrong next year. Its share price dropped about 50% last year then another 80% or something this year. It went from $50 to about 30c near the very end. On the 23rd of June a New York senator Schumer wrote a letter to the US bank regulators basicaly saying IndyMac was a zombie corps, this lead to a large number of depositors getting the hell out of dodge and a classic bank run was begun.There is an old expression best recounted "A banker who has to prove his credit worthyness, has none". Fed regulators from FDIC had had there eye on Indymac for a while it seems, but still they are trying to blame its failure on Schumer. I guess they loaned it alot of money to keep it afloat, they dont want to admit they fucked up.On Monday they moved to forbid IndyMac from taking new deposits or issuing new loans. I'd figured they leave it at that for a few weeks, but it seems confidence in the bank had totaly evaporated and the money was flooding out. Then on Friday the Feds shut the zombie down. They now run it, and will try to sell it in a few months or break it apart and sell it in pieces. Thats there official version, some speculate that they will just bury enough in tier three assets (hard to value) and flog it, others think they will run it for two years just keeping it going as long as possible. Manys the slip twixt the cup and the lip, lets just say I have no strong opinion on what will happen as there is so much water yet to run under the bridge and in its current form IndyMac is unsellable. As information develops I will form stronger opinions.
Note IndyMac is not related to FreddieMac and FannieMay, the two other big stories in the news this week. It is related to Countrywide mortgages though, being founded by ex Countrywide people.
E2A If anyone does not quite follow what I am saying or has any other questions please dont hesitate to ask. This can all be very very complex and jargon ladened. Its a tight rope between being plain enough for people to understand and not simplifying things so much that you basicaly become inaccurate or more knowledgeable people will jump in to criticize. This issue affects all of our lives quite alot so its worth keeping tabs on what is happening.
bendeus
Bellend Tagline Generator
Brilliant posts, DD, though right at the cusp of my understanding; saying that I'm no economist is a major understatement.
Thing is, from reading this and some of the more bearish stuff on housepricecrash, and by marrying it to some of my own knowledge about peak oil, I'm starting to think that we are on the edge of a precipice that could well dwarf the crash of the 30s and will definitely make those of the early seventies and nineties seem like walks in the park. The question is, how low can it really go?
Just how fucked do you genuinely think we are?
david dissadent
New Member
Short term the price runnup of oil is gonna hurt alot of firms. Virtualy every assumption made by governments and firms for planning is utterly wrong in terms of price of energy and costs of comodity inflation. This means that we will see budget short falls and project cost overruns. Its not armageddon yet. However for certain companies and industries it will be a knife fight in a telephone box. Airlines, especialy US airlines are bleeding to death at this minute. The other big loser and addition to the list of zombie corps is Ford and General Motors and Chrysler. They were being beaten badly for quality cars in the 80s and 90s by German and Japanese manufacturers and especialy beaten on price and reliability so they focused on the truck and SUV market almost exclusively in the US. This market provided more profitable per unit and while oil was low big sales and almost profits. However the run up of oil has murdered that market leaving them facing financial carmageddon. They are now shutting down entire plants and having to reintroduce cars to the US market.Brilliant posts, DD, though right at the cusp of my understanding; saying that I'm no economist is a major understatement.
Thing is, from reading this and some of the more bearish stuff on housepricecrash, and by marrying it to some of my own knowledge about peak oil, I'm starting to think that we are on the edge of a precipice that could well dwarf the crash of the 30s and will definitely make those of the early seventies and nineties seem like walks in the park. The question is, how low can it really go?
Just how fucked do you genuinely think we are?
Sunning though isnt it. Ford and GM (Opel, Vauhaull etc) do a rather neat line in cars in Europe and the rest of the world, but there problems are very very deep indeed.
There commitment to healthcare and pensions is a huge huge cost on them in the states that makes it very very hard for them ever to be really profitable again. (although GM has struck a deal to get 70% of its health care costs of off it back by 2010 apparently). So there will be victims of the current bull run of oil.
But this is not the end of the world, just the end of a world we knew. I honestly believe that manufacturing will start comming back west as transport costs increase, begining with bulky goods like shoes and furniture. As we enter a rescession our spending on luxuaries will drop so the sweat shops of the south (i.e. China) will take a fair hammering as they run on such thin margins. Our currencies will depreciate but this will generally do alot to cool the comodity inflation we have been experiancing. Time to point out, currently comodity inflation is being pegged on "speculators", this is the financial worlds means of denying resource limitations. However direct bilaterally traded goods like potash, coal and iron ore are also soaring in costs as nations and industries compete on the market for whatever is available. We are not able to increase supply as fast as demand. A global recession will help (perhaps) cool this leaving some spare capacity and collapsing price.
There are those who beleive economic momentum in China is so great they can internalise growth and create an internal demand to keep growing. I have severe doubts but the theory is there. If China keeps on growing then the bets are off.
The recession caused by US housing is essentialy a speculative bubble where people came to place huge bets on endlessly increasing house prices and created exotic financial instruments to feed of off this growth. As all of this goes to hell in a hand cart the banks will all take enormous losses and this will feed through the whole economy into things like the insurance industry and the pension funds. People will find themselves significantly poorer and stop spending as much and start saving. But its a part of an econmic cycle and as manufacturing picks up in the consuming nations and as trade barriers are raised by the west, things will pick up again. A new paradigm will be created.
This is my speculation on it but Ive been wrong more than right:
I strongly feel a more protectionist world and one where the needs for producers to be better paid and able to afford what they are producing will be the result. The alternative is basicaly a total deflationary eternal race to the bottom where fewer worse paid workers cannot afford what they are producing and financial chaos and endless asset deflation mean the old consuming west will mean a complete unwind of the gains of post WW I industrilisation and wage increases.
But true peak oil really only becomes a major problem once we enter depletion not when we are platueing. Flat supply can be acomodated by efficieny savings in vehicles and so on to begin with, Those most vaulnrable to energy costs die quickly the nimble adapt things change. It will not be comfortable but it will be doable.
The real kicker for peak happens when it hits the ruling classes that oil is a finite resource on the verge of depleting supply then is when things get ugly and nationalstic. Then is when things go to more obvious wars, trade wars and out right return to the 1800s style naked macht politiek and chauvenism.
This is what makes me a doomer in the longer term. We will kill murder and nuke for energy. Our wars will take more oil offline quicker than geology. Our capacity for destruction massively out weighs our ingenuity.
david dissadent
New Member
In the short term the UK is headed back to the 70s. As our oil and gas depletes our balance of trade and budget balance will go for a ball of shit in a hurry. But our financial sector is also set to be hammered by the international 'headwinds' (aka shitstorms) so the big fat tax they produce will drain away as we spend more of our pounds to buy everything. The pound will weaken very significantly and our budget deficit will reqire ugly cuts to the state side of the economy to remain vaguely above water.Just how fucked do you genuinely think we are?
Short term we are in for a very very uncomfortable few years. However there is a bit of hope. We have an small but excellent manufacturing base that can be grown, and as the price of oil goes up the pound will go down making overseas holidays unaffordable making UK people stay home and keep money at home while our exports become more affordable. We will be poorer but we just might be able to get on the wave of new west bound manufacturing.
We are a smart but lazy country. Our own medium term future is in our own hands to realise what needs to be done. I dont think we will we will bitch and moan and wait for some phatom force to return us to the happy days of endless quarters of growth, but if we see the problems we face we can do alot to getting on top of them.
david dissadent
New Member
300 US banks to fail.
Washinton Mutual the largest listed as being in danger.
http://www.reuters.com/article/reutersEdge/idUSN1336701420080713
Washinton Mutual the largest listed as being in danger.
http://www.reuters.com/article/reutersEdge/idUSN1336701420080713
elbows
Well-Known Member
Fear about Fannie May and Freddie Mac certainly ran wild last week. They are worried that the markets will have further volatility on Monday unless they manage to come up to a reassuring policy on this stuff. Some important people had to meet on a Sunday - must be a crisis!
david dissadent
New Member
http://www.ft.com/cms/s/0/5773a770-5106-11dd-b751-000077b07658.html?nclick_check=1
80% of new morgages issued in the US are by Fannie and Freddie.
Now they can "borrow" of off the fed, so now the dollar is going to be backed even further by US mortgages and mortgage backed securities.
Expect a rally inspite of the IndieMac debacle on Monday. The market has one last rally left in it.
I remember loads of people queuing up to declare the crisis in the US housing market was a blip and a small recession at best last September October.
david dissadent
New Member
The US is a bit panicked at the minute.
Washington Mutual down about 27%. Hmmmm. Another smaller bank had to have its shares briefly suspended.
Oh link here
http://www.bloomberg.com/apps/news?pid=20601087&sid=azynNaEBxeqc&refer=home
A sorry this is all a bit on the fly but
"Wash Mutual will have to add 'substanial' reserves: Lehman" from market watch. Does seem that there is a bit of a lack of confidence around the US banks at the minute.
Washington Mutual down about 27%. Hmmmm. Another smaller bank had to have its shares briefly suspended.
Oh link here
http://www.bloomberg.com/apps/news?pid=20601087&sid=azynNaEBxeqc&refer=home
A sorry this is all a bit on the fly but
"Wash Mutual will have to add 'substanial' reserves: Lehman" from market watch. Does seem that there is a bit of a lack of confidence around the US banks at the minute.
A Dashing Blade
Takes horses to water but can't make donkeys drink
ooops! Never a good idea to try and call the market!
bendeus
Bellend Tagline Generator
Just felt I ought to inject a bit of levity into a great, dark morass of gloom
http://www.theonion.com/content/news/recession_plagued_nation_demands
The Onion said:
http://www.theonion.com/content/news/recession_plagued_nation_demands
elbows
Well-Known Member
Dont worry Bush has it all figured out, Wall Street got Drunk!
http://news.bbc.co.uk/1/hi/world/americas/7522335.stm
http://news.bbc.co.uk/1/hi/world/americas/7522335.stm
david dissadent
New Member
Washinton Mutual is now really being rocked.
Link
Link
Another link
Basicaly the markets are getting spooked by WaMu's position, whether it has enough 'liquidity' i.e. cash to keep running or whether is steady drip of losses is meaning it is likely to run out of money at some point soon. Its problem is that it cannot really go to the markets and sell any more stocks (especialy after HSBC's fiasco) as no one really wants it stock anymore and its investors have pretty much lost there shirts already. The cost of it lending money is also getting higher and higher as people worry about getting the money back (the classic credit crunch). Worry about whether WaMu will carry on in a year or two means canny investors are getting there money out now, reducing the money WaMu has to operate. The fear is it may start also facing margin calls. This is where lenders are entitled to call for the money they have leant to be paid back. This is absolute classic bank run stuff, the big depositors etc pulling out (not covered by FDIC) and its creditors getting panicky about getting there money back while the bank is unable to raise capital.
After Bear Sterns and IndyMac we are way way way too deep into this rabbit hole for anyone to say 'nothing to worry about'. But WaMu is definently in the 'too big to fail' class. Something very innovative is going to be pulled out of the hat to keep it running, but how many rabbits does helicopter Ben have in his hat?
Jonne Donne
Nice quote from a bit of quality literature. I am under no illusions that this is some distant accademic problem but in months to come may cost me my own job. These are the bells that toll for us all.
Barking_Mad
Non sibi sed omnibus
ta for the posts DD, interesting stuff.
bendeus
Bellend Tagline Generator
They do indeed
I just wonder how many of us will be untouched by this when it finally hits the bottom. I read this today. It touches upon voluntary defaults in America: solvent, professional people literally walking away from negative equity and ceasing to pay their mortgages. Apparently there's no legal mechanism in the US for creditors to continue to pursue debtors for outstanding monies once their homes have been repossessed, so people who do not in any way fit the 'sub prime' criteria are literally walking away from hundreds of thousands of $ worth of personal liabilities, and the US banking system is teetering as a result,
Fucking scary, scary stuff
david dissadent
New Member
A 14 minute Newsnight segment covering credit default swaps and their potential impact. A worthwhile watch.
http://www.youtube.com/v/xNuBN9KJRs8&hl=en&fs=1
http://www.youtube.com/v/gJI8hbZbLdk&hl=en&fs=1
Effectively they are a totaly unregulated and unfunded insurance product who outstanding liabilities dwarfs the markets they are insuring.
http://www.youtube.com/v/xNuBN9KJRs8&hl=en&fs=1
http://www.youtube.com/v/gJI8hbZbLdk&hl=en&fs=1
Effectively they are a totaly unregulated and unfunded insurance product who outstanding liabilities dwarfs the markets they are insuring.
So inflation is shooting up and today brings news of the biggest jump in unemployment since 1992
http://news.bbc.co.uk/1/hi/business/7557925.stm
http://news.bbc.co.uk/1/hi/business/7557925.stm
http://www.telegraph.co.uk/money/ma...008/08/15/cneuro115.xml&CMP=ILC-mostviewedbox
note the stuff about spain at the bottom -9% fall in industrial output! 500k new job losses in 6 months .. watch that space .. and i am still not convinced we are not to follow
note the stuff about spain at the bottom -9% fall in industrial output! 500k new job losses in 6 months .. watch that space .. and i am still not convinced we are not to follow
david dissadent
New Member
link
Fannie Mae and Freddie Mac are once more in the news. With bells on. Basicaly they are privately owned and traded companies that were set up by the US government to aid the home ownership markets. They buy the mortguages issued by banks so that banks have more money to loan to others. They now account for the financing of about 80% of all mortgages that are being issued in the US. In theory they were much more cautious than the likes of Lehman, Bear, Countrywide, Thornburg and all that. But they were not cautious enough and have taken huge losses, moreover the fall in house prices and recession means that they are going to take one hell of a beating.
This would be just bad news for the housing sector. Youd think, but its way way more than that. Fannie and Fraddie had an implicit not explicit government guarentee. But as many critics have pointed out the people buying this stuff for banks and central banks were "the smartest men in the room", they were very well paid and very clever, they knew guarentee did not exist. But Fannie and Freddie debt was bought as if it was government debt, and shares taken as safer than gold. Central banks bought alot of this 'agency' debt. Now as the US governemnt is moving in to shore up the failing liquidity of these two companies it cannot be seen to be bailing out private investors. So if it bails out Fannie and Freddie foriegn governments, insurence companies, pension companies and the like are liable to have to take a big hit. So they have been dumping this and buying real treasuries. (This is assumed to be a part of the surge in the dollar, a flight to quality).
On the flip side some financials stocks are on the up as if Fannie and Freddie have more money to lend then they can carry on lending and housing will not plunge as much.
Also the US took a big hit in terms of jobs. Lots of people out of work. Official statistics have it at 6% but many reckon the true figure is closer to 12%. Worse as the dollar gains strength, US factories, who have been not doing as bad as they could, will start losing international orders to Germany and Japan. And the recession is starting to look global now, so a smaller share of less orders.
When oil falling nearly $40 off of its highs wont cheer people up....
Fannie Mae and Freddie Mac are once more in the news. With bells on. Basicaly they are privately owned and traded companies that were set up by the US government to aid the home ownership markets. They buy the mortguages issued by banks so that banks have more money to loan to others. They now account for the financing of about 80% of all mortgages that are being issued in the US. In theory they were much more cautious than the likes of Lehman, Bear, Countrywide, Thornburg and all that. But they were not cautious enough and have taken huge losses, moreover the fall in house prices and recession means that they are going to take one hell of a beating.
This would be just bad news for the housing sector. Youd think, but its way way more than that. Fannie and Fraddie had an implicit not explicit government guarentee. But as many critics have pointed out the people buying this stuff for banks and central banks were "the smartest men in the room", they were very well paid and very clever, they knew guarentee did not exist. But Fannie and Freddie debt was bought as if it was government debt, and shares taken as safer than gold. Central banks bought alot of this 'agency' debt. Now as the US governemnt is moving in to shore up the failing liquidity of these two companies it cannot be seen to be bailing out private investors. So if it bails out Fannie and Freddie foriegn governments, insurence companies, pension companies and the like are liable to have to take a big hit. So they have been dumping this and buying real treasuries. (This is assumed to be a part of the surge in the dollar, a flight to quality).
On the flip side some financials stocks are on the up as if Fannie and Freddie have more money to lend then they can carry on lending and housing will not plunge as much.
Also the US took a big hit in terms of jobs. Lots of people out of work. Official statistics have it at 6% but many reckon the true figure is closer to 12%. Worse as the dollar gains strength, US factories, who have been not doing as bad as they could, will start losing international orders to Germany and Japan. And the recession is starting to look global now, so a smaller share of less orders.
When oil falling nearly $40 off of its highs wont cheer people up....
goldenecitrone
post tenebras lux
I love economics as a pseudo science. What it really needs is a nudge.
link
Fannie Mae and Freddie Mac are once more in the news. With bells on. Basicaly they are privately owned and traded companies that were set up by the US government to aid the home ownership markets. They buy the mortguages issued by banks so that banks have more money to loan to others. They now account for the financing of about 80% of all mortgages that are being issued in the US. In theory they were much more cautious than the likes of Lehman, Bear, Countrywide, Thornburg and all that. But they were not cautious enough and have taken huge losses, moreover the fall in house prices and recession means that they are going to take one hell of a beating.
This would be just bad news for the housing sector. Youd think, but its way way more than that. Fannie and Fraddie had an implicit not explicit government guarentee. But as many critics have pointed out the people buying this stuff for banks and central banks were "the smartest men in the room", they were very well paid and very clever, they knew guarentee did not exist. But Fannie and Freddie debt was bought as if it was government debt, and shares taken as safer than gold. Central banks bought alot of this 'agency' debt. Now as the US governemnt is moving in to shore up the failing liquidity of these two companies it cannot be seen to be bailing out private investors. So if it bails out Fannie and Freddie foriegn governments, insurence companies, pension companies and the like are liable to have to take a big hit. So they have been dumping this and buying real treasuries. (This is assumed to be a part of the surge in the dollar, a flight to quality).
On the flip side some financials stocks are on the up as if Fannie and Freddie have more money to lend then they can carry on lending and housing will not plunge as much.
Also the US took a big hit in terms of jobs. Lots of people out of work. Official statistics have it at 6% but many reckon the true figure is closer to 12%. Worse as the dollar gains strength, US factories, who have been not doing as bad as they could, will start losing international orders to Germany and Japan. And the recession is starting to look global now, so a smaller share of less orders.
When oil falling nearly $40 off of its highs wont cheer people up....
they have basically been nationalised .. in the land of free trade LOL!
david dissadent
New Member
http://www.nytimes.com/2008/09/07/business/07fannie.html?pagewanted=2&_r=1&hp
Well lets see what the takeover package is. As the saying goes these days "if its a friday its another bank takeover" (an Arizona bank was also taken over by FIDC)
david dissadent
New Member
A Dashing Blade
Takes horses to water but can't make donkeys drink
Not neccessarily, CDS's have pretty bespoke small print, depends if you bought the CDS as a punt or as a hedge. As the bail out package seems to gurantee the bonds at par< it would seem pointless to exercise the cds if you do hold the bonds (caveated by what price you bought them for!)
hipipol
Peckham Wry
Echo the Blade
Most CDS contracts only trigger when you hit 80/90% loss aginst par, with the govt Gtee at par, no default is triggered, Those holding the rather more claver and expensive EDS Equity Default Swap) may have a case to argue
Again as these are OTC instruments, depending on the exact details of the contract, they may not get swapped out for cash - more than likely to some other security that fits the credit parameters of the original/underlying bond.
I do not yet see the sky falling, just having a really bad wobble said Ckicken Licken
It will be interesting to see the way this plays out, but I suspect that there are some White Knights in the wings - as asset values fall those with cash are licking their lips - I have a mate who runs cash for the Abu Dhabi Invest Authority - he tells me they reckon the bargains start round Q1 next year, till then they sit on their mits and watch and shit slowly plunge into the fan
We have seen economies riding a wave of cheap money for the last few years, it has a good way of masking serious inefficiencies, now the flow has slowed to a trickle, a lot of what seemed minor cracks will become fissures, but I dont see an utter meltdown - but then maybe I just dont want to, but there is still a lot of wealth and value out there - when the price is right and they think the bottom has been touched, they'll start to play again
Most CDS contracts only trigger when you hit 80/90% loss aginst par, with the govt Gtee at par, no default is triggered, Those holding the rather more claver and expensive EDS Equity Default Swap) may have a case to argue
Again as these are OTC instruments, depending on the exact details of the contract, they may not get swapped out for cash - more than likely to some other security that fits the credit parameters of the original/underlying bond.
I do not yet see the sky falling, just having a really bad wobble said Ckicken Licken
It will be interesting to see the way this plays out, but I suspect that there are some White Knights in the wings - as asset values fall those with cash are licking their lips - I have a mate who runs cash for the Abu Dhabi Invest Authority - he tells me they reckon the bargains start round Q1 next year, till then they sit on their mits and watch and shit slowly plunge into the fan
We have seen economies riding a wave of cheap money for the last few years, it has a good way of masking serious inefficiencies, now the flow has slowed to a trickle, a lot of what seemed minor cracks will become fissures, but I dont see an utter meltdown - but then maybe I just dont want to, but there is still a lot of wealth and value out there - when the price is right and they think the bottom has been touched, they'll start to play again
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