We all know what caused the 2008 banking crisis killing Lehman and others. It was reckless lending, too low interest rates, loosy-goosy credit for consumers and most of all, instigation of derivatives by greedy bankers hungry to make billions on the quick. Now that central banks have bailed them out of their insolvency and replenished minimum capital standards by stealing TARP funds from taxpayers, we find the next LARGER MESS looming on the horizon. Governments grasping for tax income will be grubbing, and taking all at a new furious pace. Consumers that are able will simply drop-out of the system and down-size.
If you thought Lehman was fun get ready to see new price controls and acceleration of existing capital controls, with inflation that will knock your socks off. We have at least two to five more years of crash and burn in the financial markets before a new base is found. Then, toxic trade policies and old grudges open the door to a new World War, which obviously no one can afford. This is simply historical fact and not any wild forecasting by me although some may consider me crazy.
Many of the very large global banks will be nationalized and some will fold into insolvency or merger. Roughly 90% of the derivatives and real estate toxic paper trash remains hidden on banker balance sheets. Not only was the problem never fixed, they’ve been piling on more bad loans-paper at a furious pace. The Banker’s Motto is “Steal while you can. You never know when the party ends.” (more)