Bankers Fear World Economic Meltdown

Originally posted by marg6043

I am having a field day don't you Udio? after the collapsing of the housing bubble this was definitely coming,

BTW how many corrupted and dirty CEOs has been indicted or arrested?

marge6043.... we are on the same 'wavelength',

neithe of us want to see a collapse which will tremendously effect the rank-&-file American workers.. out 'pay-back thoughts' are dircted at the elites...
and wish to see them all put-in-their-place...i.e.; Humbled....
while Correcting the mess they dragged the society & economy into !


btw, don't get dismayed or exasperated because the DOW gained +400 points this week...
and the US$ gained .06 cents on the Euro (exchange went from $1.56 - $1.50)
All these quirks are responses to the 'preceived' strengthening of the US$ in relation to the price of oil... (in itself a managed & manipulated, temporary situation

Watch out as the billion$ that are sitting on the sidelines, get put into the market, after being duped into thinking they will be missing out on the Super-Bull-Market taking place..... whoa Nelly, i say


thanks,

reply to post by marg6043


Kia, a division of Hyundai, is building a massive assembly plant in West Point GA. I grew up near there and still live near there. It is bringing a lot of jobs to an area whose former main employer (textile mills) has dramatically downsized and ofshored. So many jobs from that particular industry have been lost that it barely makes up for it, but hey it's better than nothing.

Anyway, I think we're still not even half way through the crisis. To respond to St. Udio about

so the Fed/Treasury has got to do a radical intervention very soon !

I dunno they just did/helped with one with the Fannie/Freddie bailout. That should be good for holding things together longer than a month shouldn't it? Things are going thier way right now, equities going up commodities going down, no telling what the next shock will be. Seems that Bank Failure Friday isn't in play this weekend (in honor of Olympics or are they still plenty busy with Indy and the others). We might be good through the Olympics , this still looks to me like a bear market rally equity wise and they can be pretty impressive.

reply to post by Rockpuck


I am really behind the news on car makers I thought that Nissan and Hyundai were Japanese cars.

Interesting that in our local base has like 20 TVs all over their gym and at the PX in the food court has also TVs, guess what they all tune in to Fox news

Fox has to be the government paid propaganda channel

the bankers fear a meltdown... mainly because the banks have to refinance their existing debts, and if there is a global meltdown then nobody has money to purchase the new bonds the banks must sell to raise the capital to pay off the debt instruments the banks have on their books.

For instance, a bank issues an annual certificate of Deposit (CD) for say 4% annual...if in Nov or Dec the bank needs probably tens of millions of dollars to satisify these debt obligations that are already in the market place. Since the bank is only required to have a small % of that cost/debt on hand in cash...the banks have to sell new CDs or other new issue bonds to finance the debts that are coming due.

A global recession means that the banks will likely only sell new bonds or perferred stock or CDs at a very steep price... say a 'new' 8 percent Bond/CD to fund a 4% debt that has to be paid right now.
Which means the bank might not be able to sell any new debt instruments - unless the bank sweetens the deal to pay 10-15% intrest on the new bond/CD offering- and could go into default or perhaps bankruptcy
if no new debt instruments are bought by the public, to keep the revolving door going


both the banks and us the population are between a rock & a hard place.

[edit on 19-8-2008 by St Udio]

How incredibly ironic would it be if all this financial catastrophe was supposed to evoke the reaction of "OMG! I'm going to lose all my money!", and all they are getting is an "eh, so what?" TPTB would be going "WTF?!"

reply to post by St Udio

Today, Citibank (C) got popped for a billion or two for fraudulently selling ARS -Auction Rated Securities...saying these debt instruments were: 'AS Good As Cash'-- which turned out to be a bald faced lie to the buying customers paying cash for these

Variable rates and Balloon Mortgages. I and a friend both got set-up in a bait and switch on our mortgages. We thought we were signing the fixed rate mortgage we originally saw and had a balloon substituted at the last minute. It was definitely sleazy. They had me wait till the very last day before the mortgage terms would expire and then I sat all day till 8PM and had a clerk shove the papers in front of me to sign. Oh yes it was CITI-Corp. I hope this # comes out too.

reply to post by crimvelvet


Let me guess Primerica? I have some people close to me who were apparently screwed over by them on a misrepresented rate during a refi.