It is Obvious

Chris Rick has got altogether too much to say

Poor little Euro

Posted by chrisrick13 on November 25, 2011

It is obvious: the Euro is not to blame

I spend a short time each day trying to find out what is going on in world finance.  It is very difficult to verify what I read.  Also everyone has an agenda and so the ‘information’ has to be read with that agenda in mind.

Today I did not have to search far to find:

http://www.golemxiv.co.uk/2011/11/buckle-up-credit-crunch-2/

My hope is to find someone who will be giving out good news, but I don’t think there is anyone.

A credit crunch is different to a sovereign debt/default spiral.  The latter might cause the former though it jolly well should not because everyone I have read could see it coming.

The article details the next credit crunch.  Note that it does it from the perspective that it is already here.  Banks are not lending to each other.  A good reason is each bank knows its own position and would not consider lending to another bank in the same position…in which they know they all are!

The banks will not make their ‘positions’ public knowledge.  This is because it is sensitive information that will affect their positions adversely – they say.  However were the bank in a good ‘position’ then it would be hugely advantageous to them to declare it.  All the money in the world would flood to them.  That they don’t declare their holdings or ‘position’ is an admission that they are bad.  Catch-22 is on the march again.

So it is entirely possible that there will be another credit-crunch long before the Euro faces up to a sovereign default, probably by a PIIGS (BFH…).

I really had not considered that one.

It is obvious: the Euro is not to blame – people are to blame…all of us

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