The Masked Tulip Posted September 15, 2009 Share Posted September 15, 2009 A good read. I will paraphrase - we're fecked. http://www.moneyweek.com/news-and-charts/e...sion-93805.aspx Quote Link to comment Share on other sites More sharing options...
eric pebble Posted September 15, 2009 Share Posted September 15, 2009 A good read. I will paraphrase - we're fecked.http://www.moneyweek.com/news-and-charts/e...sion-93805.aspx "There's still plenty of dodgy debt on the banks' balance sheets There are at least three good reasons to be concerned that this economic rebound won't last. For one thing, all that dodgy debt that was on the banks' balance sheets hasn't gone away. Plenty of it is still sitting with the banks themselves. That's one of the main reasons that – despite all the money pumping by the central banks – the money supply is plunging in the US. As Ambrose Evans-Pritchard notes in The Telegraph this morning, US bank lending fell at an annual rate of around 14% in the three months to August. Professor Tim Congdon of International Monetary Research tells him: "There has been nothing like this in the USA since the 1930s." And we all know what happened then. Banks are scared that a) regulators will force them to hold more capital (in other words, to have more of a cushion against future losses) and that rising bad debts will put them back in a position where they have to return to shareholders or governments for more handouts. Therefore, quite sensibly, they're not as keen to lend as they once were. When credit availability is shrinking, debt-dependent economies have a hard time growing. Now, we'd argue that sometimes economies that have overstretched themselves need to take the time out to lick their wounds, heal their balance sheets, and unravel all the bad investments that were made during the boom times. But that involves a fair bit of pain, something which governments in particular want to avoid, as voters don't like it." Quote Link to comment Share on other sites More sharing options...
eric pebble Posted September 16, 2009 Share Posted September 16, 2009 oh well Quote Link to comment Share on other sites More sharing options...
The Masked Tulip Posted September 16, 2009 Author Share Posted September 16, 2009 No worries, house price will save us all. Apparently the only reason aliens have not invaded is because they cannot afford the price of real estate!? Quote Link to comment Share on other sites More sharing options...
jammo Posted September 16, 2009 Share Posted September 16, 2009 Apparently the only reason aliens have not invaded is because they cannot afford the price of real estate!? I thought they got given one on the social. A house that is. Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted September 17, 2009 Share Posted September 17, 2009 Papering over the cracks, the recovery is down to artificial stimulus which is about to end. So even we have more sticking plasters and create more free money or the economy will tank. Quote Link to comment Share on other sites More sharing options...
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