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TheBlueCat

Rollover Crunch

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http://blogs.telegraph.co.uk/finance/edmun...ollover-crunch/

The summary being: banks and governments (UK & US primarily, but probably others) have rushed into borrowing money with short term repayment terms (e.g. < 3 years) and run the risk of not being able to borrow enough to fund repayments when it matures. Add that to the ending of QE and the government is going to have to borrow staggering quantities of money to avoid bankruptcy. Just like Northern Rock, only with the inflation option available as a get-out.

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http://blogs.telegraph.co.uk/finance/edmun...ollover-crunch/

The summary being: banks and governments (UK & US primarily, but probably others) have rushed into borrowing money with short term repayment terms (e.g. < 3 years) and run the risk of not being able to borrow enough to fund repayments when it matures. Add that to the ending of QE and the government is going to have to borrow staggering quantities of money to avoid bankruptcy. Just like Northern Rock, only with the inflation option available as a get-out.

This a really a very scary scenario.

There is a lot of debate about severe inflation or severe deflation on this site.

One of the two will happen. In either case, it will be very destructive and destroy our general standard of living.

The means is unknown at this stage : the outcome is inevitable.

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