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Europe
How bad debt infected the world
2007-09-20
Posted by:lotp

#10  Test
Posted by: Chuck   2007-09-20 23:45  

#9  "we all *wanted* it to be true"

What's this "we", Kemosabe?

I'd guess that anyone with more intelligence than a cupcake pan knows that 1) diverisification in your investiments is a good thing and 2) large swings in investment hurt everybody.
Posted by: no mo uro   2007-09-20 16:59  

#8  It will be interesting to see what happens with the 10 yr T notes and STRIPS.
Posted by: lotp   2007-09-20 13:36  

#7  Thank goodness the deficit is down significantly, or we'd be in really bad trouble. As it is, the Treasury had discontinued issuing the shorter notes in recent years because they didn't need the money.
Posted by: trailing wife   2007-09-20 11:31  

#6  Warnings about an historic collapse in US housing prices here

Also: US $ hit a new low against the Euro today and is very weak across other currencies. China is about to launch a $300 billion investment fund which will diversify them away from dollar dependency and put more pressure on Treasury debt and the dollar over all.
Posted by: lotp   2007-09-20 10:23  

#5  Japan's problems have more to do with it's demographic situation than housing. I'd look for the same to happen in Europe and China where similar demographic problems exist before the US.

The fundamental problem is that the balance between fear and greed has been destabilized by government interference in markets. This interference allows markets to remain out of equilibrium for longer than would be the case absent the interference. As a result bad problems don't get fixes and grow to be really big bad problems. Then it takes a really big injection of fear to return to equilibrium.
Posted by: Nimble Spemble   2007-09-20 09:57  

#4  Well the banks, and their various paper fronts, speculating with credit to individuals who shouldn't have been able to sign on the dotted lines are just as responsible. One of the mistakes Ronnie made was bailing out non-FDIC banks and savings and loans in the 80s. It's set a precedent for the gamblers losers to ask the rest of us to bail them out. We're hearing it already now. I can remember it was hard to get credit. Today everyone get numerous enticements of 'pre-qualification' weekly. College students without any work history or financial record are signed up for life long debt. The prime is around 5%, but card interest rates still are in the upper teens. Every other active card holder is carrying the bad debt of forfeited accounts. Yet, I could bet in Vegas that the very same financial entities at the heap of the conglomerate paper structure will issue annual statements of 'profit' for the year they get us to cover their loses.
Posted by: Procopius2k   2007-09-20 09:45  

#3  Residental property prices in Japan have fallen for 15 years straight and will fall again this year. This is just the trigger that starts the ball rolling.
Posted by: phil_b   2007-09-20 09:28  

#2  Lay this to some degree at the feet of the Dems in Congress. Remember the bill that made personal bankruptcy easier? Forced through by the Dems. The glut of subprime lending followed as predictably as night follows day.
Posted by: lotp   2007-09-20 07:22  

#1  Much like the dot-com bubble, we all *wanted* it to be true.
Posted by: Seafarious   2007-09-20 00:08  

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