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Realistbear

$103 Trillion Needed To Plug Global Black Hole

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http://uk.finance.yahoo.com/news/-103-trillion-credit-needed-reuters_molt-684155710.html?x=0

$103 trillion credit needed to support global growth - WEF
13:53, Tuesday 18 January 2011
ZURICH (
Reuters
) - An extra $103 trillion of credit is needed over the next decade if global economic growth is to meet consensus forecasts, the World Economic Forum and McKinsey said in a report to be discussed at next week's Davos meeting.
The study, to be presented at the WEF's annual meeting of policymakers, bankers and business leaders in the Swiss ski resort, said meeting credit demand would be challenging.
"Globally, financial protectionism may constrain cross-border financing, a key to the provision of sufficient credit in the next decade, as global imbalances persist," the WEF said in a statement on Tuesday.
It said Asia might struggle to meet high credit demand growth of $40 trillion with less developed financial systems and capital markets, while banks in the European Union would need to lend a further $13 trillion.
"To supply this, banks will require additional capital that, after retained earnings, could lead to a capital shortfall of $2 trillion," the report said.
Meanwhile, the United States will continue to need to draw on global savings, potentially by up to $3.8 trillion in 2020, to fund its credit needs, unless there is a big increase in the domestic savings rate.
"The report finds that the large projection in credit demand can be safely met, but financial institutions, regulators and policymakers need more robust indicators of unsustainable lending, contagion risk and credit shortages," it said.

When you consider the size of the HPI (and commodity ) bubbles that are collapsing and will be collapsing it is going to leave a huge hole. Most of the bubbles are made up of nothing--they are the products of creative bankster smoke and mirrors that will evaporate the moment someone tries to lay hold of something with which to settle an outstanding account.

TBH, I think the magnitude of the black hole is too big to handle and it may well collapse the entire system--and I do mean the ENTIRE system which will leave NOTHING untouched (i.e. nothing as in not even you know what) because everyone will be skint.

Edited by Realistbear

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TBH, I think the magnitude of the black hole is too big to handle and it may well collapse the entire system--and I do mean the ENTIRE system which will leave NOTHING untouched (i.e. nothing as in not even you know what) because everyone will be skint.

This is where economics fails to amke sense to me.

How much money is there in the world? If that is even a sensible question ( which I suspect it isn't and there are probably about 17 different correct answers ).

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In a debt based monetary system the only way to create more growth is to create more debt.

https://www.cia.gov/library/publications/the-world-factbook/geos/xx.html

GDP (purchasing power parity):

$74.43 trillion (2010 est.)

country comparison for the world

$71.17 trillion (2009 est.)

$71.67 trillion (2008 est.)

note: data are in 2010 US dollars

GDP (official exchange rate):

GWP (gross world product): $62.22 trillion (2009 est.)

We have the exponential growth of debt funding the exponential growth of GDP.

I would argue we are at the limits of the exponential game the figures quoted are losing all meaning.

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This is where economics fails to amke sense to me.

How much money is there in the world? If that is even a sensible question ( which I suspect it isn't and there are probably about 17 different correct answers ).

Money is just a claim on 'wealth'. Wealth can be anything that people need or want, be it houses, commodities, food, agricultural land.

Anything can be used as money, but the only forms of money that work effectively are forms that people trust and that trust usually comes from the fact the money being used is easily divisible, fungible, liquid, not easily faked or destroyed, is recognised to hold value and universally accepted as a form of payment. What is currently happening is that trust in the current form of money 'modern debt-based fiat currency' is being eroded. As the article makes clear, modern money is debt, and we need to keep creating more debt to keep the monetary system rolling.

Eventually the monetary system will collapse under its own weight, because the current system cannot go on as it is, it is an absurd system. When it collapses, a lot of people who thought they were holding valid claims on the world's wealth by holding the old debt-based money will find themselves broke. Of course, the land, the commodities, the products people buy, will not have gone anywhere, that wealth will still exist in the world, only the monetary means of valuing and exchanging that wealth will have failed.

As a consequence there will be global rebalancing of wealth distribution, many who thought they were rich will become poor (those holding debt-based money), and others who are holding the correct time-tested monetary assets will, in all likelihood, find their claim on the world's resources has increased many-fold (they will become rich).

Edited by General Congreve

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In a debt based monetary system the only way to create more growth is to create more debt.

https://www.cia.gov/library/publications/the-world-factbook/geos/xx.html

We have the exponential growth of debt funding the exponential growth of GDP.

I would argue we are at the limits of the exponential game the figures quoted are losing all meaning.

I think that would be a reasonable argument.

Debt > GDP = insolvent world.

The world's wobbling on its axis under the weight of all the debt.

That can only mean one thing... the debt is not equality distributed.

Wow, good old reliable physics provides useful insight where economics fails me. ;)

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In a debt based monetary system the only way to create more growth is to create more debt.

https://www.cia.gov/...ok/geos/xx.html

We have the exponential growth of debt funding the exponential growth of GDP.

I would argue we are at the limits of the exponential game the figures quoted are losing all meaning.

How do you do it in a non-debt based monetary system?

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This is where economics fails to amke sense to me.

How much money is there in the world? If that is even a sensible question ( which I suspect it isn't and there are probably about 17 different correct answers ).

The whole thing is a hoax. The money isn't there.

The value of all derivatives in the world is 1.5 quadrillion dollars.

The world GDP is only 60 trillion dollars.

A bunch of gamblers and their enablers making silly promises to each other, and offering up the sheeple taxpayer and their children (and their children, etc) as collateral.

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The whole thing is a hoax. The money isn't there.

The value of all derivatives in the world is 1.5 quadrillion dollars.

The world GDP is only 60 trillion dollars.

A bunch of gamblers and their enablers making silly promises to each other, and offering up the sheeple taxpayer and their children (and their children, etc) as collateral.

I feel that at some point the sheeple will have to go 'Tunisian'.

Edited by General Congreve

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I feel that at some point the sheeple will have to go 'Tunisian'.

It has to happen soon.

The problem will get worse, like rolling a snowball further and further up a hill, it gets bigger as you go up, and once it stops and starts rolling back down it still gets bigger on the way down too.

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I feel that at some point the sheeple will have to go 'Tunisian'.

Just don't go too far otherwise TPTB will put you in prison. That student with the fire extinguisher springs to mind.

Still none of that will matter if the fiat money system goes up in smoke, the supermarkets are stripped bare and the nation starts to go hungry. Don't be surprised if it happens!

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How do you do it in a non-debt based monetary system?

Are you asking how you can get growth without the creation of new debt?

A simple answer is you would allow a certain amount of money to be created as long as it was matched by productive capacity, fail to get the increase in productive capacity the money would get destroyed. You have to have a system that can breathe expand and contract, to be honest that would take a seismic shift because currently no one will allow the system to contract. Instead it continually expands as everyone loves promising GDP debt funded growth.

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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