Friday, July 11, 2008

This is The Big One!!

US pondering £2,500bn 'Rock-style' bailout

Born in the Great Depression, renationalised in the ... er ...

Posted by mark wadsworth @ 02:39 PM (2249 views)
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15 thoughts on “This is The Big One!!

  • The government is counting on Fannie Mae and Freddie Mac, which own or guarantee about half the $12 trillion in home loans outstanding, to help revive the housing market. Congress lifted growth restrictions on the companies, eased their capital requirements and allowed them to buy bigger “jumbo mortgages” to spur demand for home loans as competitors fled the market.

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  • is that the end of the USA?

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  • mark wadsworth says:

    sb303, thanks, scary indeed!

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  • This of course involves huge amounts of money, but as usual they’ll just print more and chuck it where they believe it’s needed. Hyper-inflating the economy and pushing the $ ever downward. The outcome is likely to be a collapse in the economy and another war. I think this just about sums it up.

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  • The americans have never really tasted inflation like the Europeans, hence the differing central banks position. Inflation helped lead Europe into war and if the US gets a really good taste of it who knows!

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  • If house-prices drop 30%, that’s $4tn of value … gone.

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  • @ Maddison – not quite true – the USA began with a hyperinflation!
    Read Nathan Lewis’ dense and rambling but thoroughly excellent “Gold” for a full explanation.

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  • Can’t access the article but if it really is £2,500 bn = $5 trillion = 40% of US GDP.

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  • Fannie & Freddie own or guarantee $5+ trillion of US residential mortgages. That must be where this figure comes from. Presumably the vast majority of these are fairly safe.

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  • Markets down, Gold up !

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  • BBC and CHANNEL 4 are reporting on this, sounds like this is the pivotal point now……

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  • Scary indeed. I wonder if the Avg Joe in the US has any idea what it means.

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