Everything is so interlocked it will fuck things up everywhere. The sub-prime crisis was sparked by American companies packaging up American mortgages to sell as assets, but it still was a global crisis.
Oh yeah, I think the 2008 Crash proved it’s not a question of if an Economic Collapse in the US will harm the rest, it’s a question of how much.
I mean, last time around Landesbanken in Germany were going down because of buying CDO-squared derivatives backed by US Realestate Assets and plenty of large banks in Europe had to be saved because of similar malinvestements or simply their counterparties on the derivatives which were supposed to offset certain risks were other financial instituations which went bankrupt.
It’s when the tide goes down that we see how many were swimming whilst wearing no shorts, and like in the US most Central Banks around the World never fully rolled-back the “temporary” ultra low interest rates thus having far less “dry powder” this time around to soften the Economic blow so this crash might very well be even worse than the last one, even with reduced financial interconnectivity between countries.
I expect that, once again, we will all be living the curse of “interesting times”.
Everything is so interlocked it will fuck things up everywhere. The sub-prime crisis was sparked by American companies packaging up American mortgages to sell as assets, but it still was a global crisis.
Oh yeah, I think the 2008 Crash proved it’s not a question of if an Economic Collapse in the US will harm the rest, it’s a question of how much.
I mean, last time around Landesbanken in Germany were going down because of buying CDO-squared derivatives backed by US Realestate Assets and plenty of large banks in Europe had to be saved because of similar malinvestements or simply their counterparties on the derivatives which were supposed to offset certain risks were other financial instituations which went bankrupt.
It’s when the tide goes down that we see how many were swimming whilst wearing no shorts, and like in the US most Central Banks around the World never fully rolled-back the “temporary” ultra low interest rates thus having far less “dry powder” this time around to soften the Economic blow so this crash might very well be even worse than the last one, even with reduced financial interconnectivity between countries.
I expect that, once again, we will all be living the curse of “interesting times”.