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BIS chief fears fresh Lehman from worldwide debt surge

grip

grip

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Bank for International Settlements fears fresh Lehman crisis from worldwide debt surge - Telegraph

Mr Caruana said the international system is in many ways more fragile than it was in the build-up to the Lehman crisis. Debt ratios in the developed economies have risen by 20 percentage points to 275pc of GDP since then.

The BIS warned in is annual report two weeks ago that equity markets had become "euphoric". “Overall, it is hard to avoid the sense of a puzzling disconnect between the markets’ buoyancy and underlying economic developments globally,” it said.

The BIS says prolonged monetary stimulus in the US, Europe, and Japan has led to a leakage of liquidity, contaminating the rest of the world. The rising powers of Asia are no longer able to act as a firebreak – as they did after the Lehman crash –and may themselves now be a source of risk.
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With FOX Business News talking about a big Market Correction coming, it's a little scary to see these kind of reports.

I'm not a financial expert, but I don't see how corporations cutting back wages, employees and inventories can continue to lead to profits and value indefinitely? Investors looking for returns have spurred the stock buying because of low interests rates, but growth relying mostly on cheap credit won't keep the two balanced if people aren't earning enough to buy their products or save money.
 
grip said:
Bank for International Settlements fears fresh Lehman crisis from worldwide debt surge - Telegraph





With FOX Business News talking about a big Market Correction coming, it's a little scary to see these kind of reports.

I'm not a financial expert, but I don't see how corporations cutting back wages, employees and inventories can continue to lead to profits and value indefinitely? Investors looking for returns have spurred the stock buying because of low interests rates, but growth relying mostly on cheap credit won't keep the two balanced if people aren't earning enough to buy their products or save money.
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Big correction would be alright. It sounds more like three inter-related bubbles that would drag us into recession, at least. But it is never quite predictable, when the end will come.
 
Psssh..... how could the Bank for International Settlements possibly be able to predict Central Bank policy around the globe, or have unique insight into emerging market debt?





.......wait........
 
I don't think some people know what the BIS is?



1. By keeping interest rates artificially low, the Janet Yellen-led Federal Reserve has encouraged reckless government borrowing and spending while crushing savers, especially America’s retirees.

2. The Fed has focused all its efforts on making the rich even richer through Quantitative Easing while working people suffer and are ignored by Washington’s elite.

But at CNBC, he’s talking to the walls as their support is 100% behind the Hamptons / Greenwich hedge fund class, who have been closely tied to the current presidential administration.

The mega-Rick Rant returns! | Media Equalizer
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