Will the financial system collapse by 2013?

Discussion in 'Economy' started by william the wie, Oct 22, 2010.

  1. william the wie
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    william the wie Gold Member

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    I'm not sure. 2-3 weeks ago GMAC popped up on the radar at the start of foreclosuregate. About a week ago I saw my first story of lawsuits by MBS bondholders now these stories are becoming common.

    Let's see if I can lay this out properly. The states invested pension funds into the bubble and lost money in the bust. The bust also decreased state and local tax revenues by dropping real estate values. Therefore state and local officials have strong incentives to overturn crap foreclosure filings and then produce revenues from foreclosuregate. They will then have evidence to produce in federal court showing a lack of due diligence in securitization.

    So how much chewing on the money center banks from multiple directions before they meltdown?

    What will replace the Too Big To Fail banks?
     
  2. 2Parties
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    2Parties Senior Member

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    define "collapse".
     
  3. william the wie
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    william the wie Gold Member

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    Like the fall of 2008 only bigger and messier.
     
  4. uscitizen
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    uscitizen Senior Member

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    A bunch of smaller area banks to serve the area they are located in.

    Bigger is better?
    More centralized is better?
     
  5. william the wie
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    william the wie Gold Member

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    I have no problem with that but less leveraged banking is better than bigger or smaller which is why I use a credit union.
     
  6. uscitizen
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    uscitizen Senior Member

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    anyone else personally remember the S&L scandal?
    And bailout. Which I think the bonds that bailed it out are now comig due so we will actually finally be really paying for the S&L bailout.

    umm except for the fact that the SL bailout bonds will be paid off by selling more bonds to China?
     
  7. loosecannon
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    loosecannon Senior Member

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    I dunno, Willie. The Fed and the Federal government are completely committed to the biggest banks at the expense of the states and the general economy.

    I can imagine the general economy melting to zero and the biggest banks surviving, but I can't imagine the Feds allowing the opposite.

    During the great depression poaching regs and tax auctions on private property continued unabated. People lost it all while the richest made fortunes often as a direct result. The government did nothing about it.

    The richest of the rich are too big to fail. Too big to jail. The rest of us are disposable.
     
  8. william the wie
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    william the wie Gold Member

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    Durant (founder of GM) and Insull (founder of Southern Co.) became really broke really quick in the 1930s. None of the Morgan clan hold positions of prominence in any of the TBTF banks and haven't done so since the 60s. Sounds like turnover to me.
     
  9. loosecannon
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    loosecannon Senior Member

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    "None of the Morgan clan hold positions of prominence"

    they died off. Almost every other mogul survived and thrived.
     
  10. william the wie
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    william the wie Gold Member

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    So sorry they didn't, both male lines from Jack and the various female lines are still well to do just not prominent. Also the lines of JP sr.'s siblings are also presumably going strong except for the two lesbians one his sister and the other his daughter. The family remittance man the son of one sr.'s brothers married a geisha before WWI and that union had no issue but generally speaking the Morgans have a lot of descendants.
     

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