Central bank body warns of Great Depression

The Bank for International Settlements (BIS), the organisation that fosters cooperation between central banks, has warned that the credit crisis could lead world economies into a crash on a scale not seen since the 1930s.

In its latest quarterly report, the body points out that the Great Depression of the 1930s was not foreseen and that commentators on the financial turmoil, instigated by the US sub-prime mortgage crisis, may not have grasped the level of exposure that lies at its heart.

According to the BIS, complex credit instruments, a strong appetite for risk, rising levels of household debt and long-term imbalances in the world currency system, all form part of the loose monetarist policy that could result in another Great Depression.

http://www.bankingtimes.co.uk/09062008-central-bank-body-warns-of-great-depression/

Ah the cassandras are now moving to central bankers


I am not sure if I should celebrate that we Cassandras were right, or saddened knowing that people will STARVE

On the bright side, this may lead to quite a bit of revolutionary feelings out there.... yes even here...

As year the rolled along, it became apparent that things were definitely not ok.

in a hand basket

We are set up for a repeat of the 1930's


With the flooding in Iowa, Illinois, Indiana crops are destroyed, not with dust and drought as in 1930's but with water. Couple that with the deep recession we are in and a worthless republicon President, we are sitting in the middle of the perfect storm headed for a repeat of the Great Depression.

that the parallels to 1929 were too close to ignore

We've been laughed at by the Cheerful folks that never seem to see anything wrong

So now we have Central Bankers join the Cassandra club... gives me no comfort

Oh and add war... that wasn't there in 1930

Even if STOOPID does not attack Iran... we are still in a hell of a pickle

We were lucky in that we were able to pay cash for a little house in a small town, so that at least we'll have a roof over our heads if the worst happens.

And, just like during the Great Depression, I see a repeat of what happened in politics: Repukes spend wildly, the economy collapses, and people go crawling to a Democrat to help the nation out of the mess.

Sadly--just like before--I predict that as soon as the crisis is over, people will go right back to being greedy. They'll start pissing and moaning about how their "hard-earned money" is being spent on social programs...and the cycle will begin anew.

if and when jobs evaporate and local government goes broke. I'm all for paying my fair share of taxes, but in my own case I may not be able to afford much more and still keep a roof over my head. I live in a small 1100 square foot house and the taxes right now average about $300 a month. I hate to think what people are paying in those giant McMansions.

economy. Money going out of the country when it is needed at home instead.

but it will not be a win for the farmers - they may actually chose not to replant because of the cost. When I was in high school my father's crops were flooded out and we replanted. A second planting is a real gamble though because everything has to go just right - no more storms, enough rain and a late fall.

Most corn varieties need 80-90 days to mature. First, the fields have to dry out enough so that the tractors don't get stuck or unduly compact the soil, and then you have to wait a week or so before the seeds germinate and break through the soil. They'd be lucky to see a second crop sprout by early July at this rate. If they used the fastest-growing hybrids available, and we have a warm fall, they might get a halfway decent crop, but that's a lot of if's and maybe's to work with. Honestly, I think anywhere that's flooding in Iowa is too far gone to replant; this far north the growing season is fickle and we've already had a cool spring and summer.

I suspect most farmers will just take the crop insurance payouts and maybe plant a green manure/cover crop for next year.

I'm hoping we aren't facing that kind of future.

preparing for food shortages and economic collapse/semi collapse/weak Depression....

Preparing for high levels of unemployment, etc.

geyser.

thread-
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x3440196

Basically, it's not a matter of if, but when this hits the streets of duh'murikkka.

BHN

:sarcasm:

We both know it will come, and chances are it will be OFF the media until they cannot deny it

I went to a local sporting store, small chain as I try to avoid the corporate
bastards; there were about ten gang bangers at the gun counter buying guns.

For those who connect the dots, or are paying attention,
this was not a comforting thing to witness.

When the shit DOES hit the fan here in the states,
I think I want to own a gun too.

BHN

and train to use it....

Cannot emphasize that enough, but we are going to be in a hell of a ride

I've worked with the local gang bangers.
They think nothing of shooting you dead if you have
something they need/want.

They are better armed than the local police who will
most likely head for the hills when all hell breaks loose.

We are on our own, witness Katrina, and soon I would
guess the Iowa flood victims.

BHN

so I know the culture...

Long term if the NEXT president does not drag out Maynard Keynes, then it will be more than tar and feathers

The gangs will be a problem... short term, to medium term, but even they will run out of ammo, and I know they will kill if they want something

It is a very difficult culture and many of them currently are serving in the miliary

BHN

WWIII in another 10-15 years.. I wonder who will start it this time.

:thumsup:

our economy would be in a better shape. Big wars have a way of boosting economies.

we re-industrialized the country

It is considered an exception to the rule

See WW I for example

Oh the Spanish American war for another example

Not to mention the CIVIL WAR

did I mention the war of 1812 and the Mexican American War

Oh and lets not go into the War of Independence

One exception does not make that truist true

Oh I forgot Korea and Vietnam

http://www.feralscholar.org/blog/

In the past year or so he has become a great source for exchanging information with those of us attempting to
better educate ourselves on how to prepare for what is likely to come.

It's awful. Pick a bank. Look at its chart. You will see a descending cascade -- a waterfall of lot money, hopes, dreams, futures, lives. It's an awful sight. Go to Yahoo Finance and type C or I think it is Leh in the symbol box. You will see the Bush economy falling off a cliff.

safe places for people to keep their money..as in SAVING money.. the money saved was "borrowed" by the banks to loan out to other people who paid MORE interest to borrow it, than the banks paid the customers who deposited their savings.. THAT was the money the banks made as profit and how they paid their staffs & themselves..

Banks have morphed into bloated tweaky ponzi schemes, existing only to rip off everyone..borrowers & savers, alike...everyone EXCEPT the big shots & the "stockholders"..

they juts "play" with the money and try to grab as much as they can . and then bail just before it all goes sour..

They compete to give high interest rates and to buy and build more banks. The competition pushes them to have to make higher and higher profits.

The truth is that our economy has been flailing since the recession in 2001. It has never recovered its fundamental vigor. Banks have tried to make up for the fact that they cannot make money the old fashioned way by investing in the sophisticated version of get rich quick Ponzi type schemes.

The chickens are coming home to roost.

These bankers are actually a bunch of "business majors," who never really learned to think beyond rows of numbers and catchy phrases in business management texts.

http://blog.nationbuilder.org/2008/06/bis-worlds-most-powerful-and-secret.html

Friday, June 13, 2008
The BIS - the World's Most Powerful and Secret Bank - Warns of Great Depression
Bank for International Settlements (BIS)

Central bank body warns of Great Depression
by Gill Montia

The Bank for International Settlements (BIS), the organisation that fosters cooperation between central banks, has warned that the credit crisis could lead world economies into a crash on a scale not seen since the 1930s.

In its latest quarterly report, the body points out that the Great Depression of the 1930s was not foreseen and that commentators on the financial turmoil, instigated by the US sub-prime mortgage crisis, may not have grasped the level of exposure that lies at its heart.

According to the BIS, complex credit instruments, a strong appetite for risk, rising levels of household debt and long-term imbalances in the world currency system, all form part of the loose monetarist policy that could result in another Great Depression.

The report points out that between March and May of this year, interbank lending continued to show signs of extreme stress and that this could be set to continue well into the future.

It also raises concerns about the Chinese economy and questions whether China may be repeating mistakes made by Japan, with its so called bubble economy of the late 1980s.

EDITORS NOTE: Quite a few comments have been made that there is no direct reference to the Great Depression in this month’s BIS report.

While this is strictly true, BIS warned in June 2007 - just before the Credit Crunch really hit - that the global economy was vulnerable to a major economic set-back because of extraordinary exposure to collateralized credit.

BIS directly made references to the 1930’s as an example of a similarly serious credit bubble, and this month’s BIS report describes the conditions of this being lived out.

So, to be pedantic, the warning “BIS warns of Great Depression” is actually a year old already. What BIS discusses now is the fragility of existing conditions of the fall-out from a massive credit bubble bursting - which has already been made clear across their reports historically can be similarly referenced to the 1930’s, though stated in a typically conservative and non-alarmist language.

Even what optimism BIS had about a weak recovery to the end of May 2008 have been dashed by extreme shorting of financial stocks across the US and UK - Lehman Brothers, HBOS, and property developers such as Barratts, have all taken extreme beatings in June 2008.

So back to the headline - BIS have indeed already warned of repeat of conditions that could be as extreme as the Great Depression, and are now describing that process as we move through it.

In the meantime, unemployment is already on the rise on both sides of the pond, and the analogy some people have concerns about I’m afraid are still salient.

- Brian Turner, Editor, Banking Times.
http://www.bankingtimes.co.uk/09062008-central-bank-body-warns-of-great-depression/

reading now..