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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?


To: Jacob Snyder who wrote (72204)3/24/2011 1:33:26 AM
From: Jacob Snyder  Read Replies (1) | Respond to of 217561
 
...the aging of the baby-boom generation and rapidly rising health care costs are likely to create a large and growing gap between spending and revenues. These deficits will take a toll on private investment and economic growth. At some point, bond markets are likely to turn on the United States — leading to a crisis that could dwarf 2008.
- from a statement by By 10 EX-CHAIRMAN/CHAIRWOMAN OF THE PRESIDENT'S COUNCIL OF ECONOMIC ADVISERS

politico.com



To: Jacob Snyder who wrote (72204)3/27/2011 12:26:29 PM
From: elmatador  Respond to of 217561
 
Hard assets must be sold as banks go begging for lenders of last resort.

Should floundering banks fostering moral hazzard? Or should the market be left for its own devices, leaving ailing patients to minister for themselves?

In the end Bernanke threw lifeline after lifeline to the deserving and to the undeserving alike on an unprecendent scale. Like some colossal deus ex machina, the FED and other central banks brought the crisis to an abrupt, if somehow unsatisfying, close, leaving plenty of questions unanswered and problems unresolved.

The option would have been selling the assets. But it was preferred to throw the lifelines than sell them. Here is why.

The prospects of Saudi Arabian and Chinese controlling American and European banks was unpalatable., so the recapitalization of the troubled banks took the form of preferred shares. This meant in practice the Sovereign Wealth Funds received only a minority stake, and no board membership not voting rights.

NOURIEL ROUBINI Crisis Economics.