Friday, December 12, 2008

Bankrupt Banks

Jim Rogers calls most big U.S. banks "bankrupt"

"What is outrageous economically and is outrageous morally is that normally in times like this, people who are competent and who saw it coming and who kept their powder dry go and take over the assets from the incompetent," he said. "What's happening this time is that the government is taking the assets from the competent people and giving them to the incompetent people and saying, now you can compete with the competent people. It is horrible economics."

Posted by gardeniadotnet @ 08:21 AM (1266 views)
Please complete the required fields.



10 thoughts on “Bankrupt Banks

  • gardeniadotnet says:

    “Governments are making mistakes,” he said. “They’re saying to all the banks, you don’t have to tell us your situation. You can continue to use your balance sheet that is phony…. All these guys are bankrupt, they’re still worrying about their bonuses, they’re still trying to pay their dividends, and the whole system is weakened.”

    Reply
    Please complete the required fields.



  • Swap the words competent with honest and incompetent with dishonest and you may be nearer the truth.

    Reply
    Please complete the required fields.



  • Lots of people slag me off for saying that George Soros and Jim Rogers talk sense on this matter, but I’ll tell you what they know what they’re talking about – has anyone else in the world of investment finance had the guts to say what they are saying about what is wrong with US and UK strategies to get out of this mess?

    Reply
    Please complete the required fields.



  • Exactly the same situation here with houses.

    Not that I’m a greedy vulture looking to cash in on others misery, but the bailout here seems to be passing money from the prudent to the profligate at an alarming rate.

    Reply
    Please complete the required fields.



  • This is all true, but the problems are so huge that allowing the incompetent to go to the wall in a fit of moral outrage
    will destroy us all.

    Reply
    Please complete the required fields.



  • Capitalism and democracy are uneasy bedfellows. In capitalism, wealth is distributed in a pyramid, with a small group of wealthy investors at the top and a large base of people with zero or negative net wealth. Naturally they will vote to inflate and tax their way out of debt.

    Reply
    Please complete the required fields.



  • I agree with Jim Rogers from an economics point of view. However, after all the Greenspan years of stimulous upon stimulous to step back now and let it fall means soup kitchens and great depression scenes. That suits wealthy people like him and savers like myself but not the majority of people who now live a life of dependency on borrowed money. What Jim Rogers is saying is that this has been going on for years and years. If banks and markets had been allow to fail years ago they might have been more prudence and not got us to where we are now.

    Reply
    Please complete the required fields.



  • Rogers has fallen for a story line and cannot now detach from it ie the demise of the US and the rise of China in its place. The storyline may have some validity over a time frame although there are a host of questions about China starting with its lack of transparency and absence of anything we would recognise as democracy along with the worst demographic in the world. Also in fairness China as a nation are relatively untested when it comes to the sort of innovation needed to drive the world forward, something which the US have excelled in with the recent rise of technology over the past couple of decades.

    Not to mention that it is entirely unclear where China go now given that they cannot rely on excessive western consumption – china is as much a bubble economy as the US, people easily forget that because we think there is something morally superior about industry.

    Anyway I think a central issue is that commentators get egotistical and like to think (a) the seismic shift will happen in their life time and (b) that they will be the ones to have predicted it.

    Reply
    Please complete the required fields.



  • The situation is really starting to remind me of the attitudes portrayed in Ayn Rand’s “Atlas Shrugged” – it’s like savers/lenders have gone on strike because they can’t find anybody credit worthy to lend to at ridiculously low rates, and the government keeps trying to bully, cajole and bribe them with money squeezed out of a dwindling number of competent, productive people.

    Reply
    Please complete the required fields.



  • Bells – “Rogers has fallen for a story line and cannot now detach from it ie the demise of the US and the rise of China in its place.”
    I was thinking similar, thanks for fleshing out.

    Reply
    Please complete the required fields.



Add a comment

  • Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
  • Please note that any viewpoints published here as comments are user´s views and not the views of HousePriceCrash.co.uk.
  • Please adhere to the Guidelines

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes:

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>