Topic: Reason of Next Financial Crisis - page 3. (Read 562 times)

A larger focus here is how and why are these banks letting it happen if there are certain standards set in place for loans? Are they intentionally letting this happen or is this just a mismanagement happening at the lower end? If these lenders are found purposely cornering these debt companies to default then we might see a really big turn of events here concerning the economy. The way I see it is if the greater portion of these troubled companies are unable to pay then we might see a lot of people losing their jobs, stock prices falling, and of course the US dollar losing its value, it will just simply be a chain reaction that will trigger another recession.

We cannot stop the economic crisis in the future, needs always increase and inevitably have to borrow. Yes, it is true that bitcoin can be an alternative but do not let bitcoin become the cause of the economic crisis.

I think the clear choice is the shareholder trouble all companies have. Shareholders want to make more and more money every single year, all companies with shares open to public is forced to bring in more and more profits every single quarter.

It means a company that is not making profit will be getting their stocks and shares sold so the investors go buy the company that made profit instead, which means the company who was already having trouble profiting now also doesn't worth too much as well because of sudden sales on their shares.

Basically, you have to keep on making profits forever if you want to and that is just not sustainable. Things that are financially not sustainable is the reason why we have economic crisis and eventually this shareholder drama will create a big chaos like the 2008 one as well.

What I really don't get is why people keep getting surprised by these cyclical economic crises. It's happening every 10-15 years, and it's been happening for every 100 years, with varying degrees of severity.

If the system is broke, then of course we're going to keep seeing these signs. We have to keep expecting it, because this is symptomatic of the disease.

Every time something like this happens, states and central banks move but only to put band aids. They're not willing to fix a system that's enriching them. Hopefully people wise up and seek alternatives. Bitcoin I won't say is the saviour, I'm not that idealist, but it's a great start.

Looks like holes are found again.
Who will bet against it? I guess that is the question out there. Remember that movie where a group of people have found that hole and tried to warn everybody but nobody believes them.
They bet all that they can and won it but in exchange for a sorrowful country.

I guess nobody will believe this too since they still think they are all strong countries.
Better stay with crypto. The bubble is not popping for so many years.

Our economic managers are unholy professionals who are good at nothing but deliberately creating poverty and enslaving many generations unborn in the name of regulation. The rich keeps getting richer, while the middle class is at the verge of been displaced. If they really mean business, while giving loans to companies with low Credit wordiness? Is this not daylight robbery? Same guys keep enriching themselves in other to maintain the old empire of the nobles. I hope people switch to Bitcoin soon.

I remember when the government is trying to push people to spend their money.
Looks like the circulating fiat is getting lower and that is why they need people to spend. Too much savings makes this happen.
Now, they want to print out another batch of money which makes a bigger problem.

They really need a new kind of currency that will circulate for that not to happen again. What could it be that they will use?
Is it really bitcoin or just another centralized crypto currency. Looks like XRP is ready for that.

After 2008 crisis, we know central banks like BoE, ECB and The Fed always printing more money and they called as QE but we know the truth its just not touching real bussiness. Economic crisis is just a matter of time

I don't think so, it seems that you're mad with the US but can't blame you either. bitcoin is a digital currency and limited not like Fiats.

There are a lot of thoughts that Bitcoin will boom if there would be the next global financial crisis and I'm so excited that it will happen sooner as it's inevitable.

It's certainly possible that irresponsible lending could trigger another financial crisis. It seems like that credit in a lot of countries have been trending towards the easier end of the credit availability spectrum since the GFC, which could have influenced rising stock and real estate prices in certain countries again.

The thing with fiat is that, since it is so entangled with debt, if one thing goes wrong the whole chain of things could spiral out of control.

We can't say for certain what type of financial crisis the next one will be or who or what causes it, but for certain it's only a matter of time before it happens. It could be inflationary, recessionary, market failure... Just be prepared by hedging against the traditional economy. Holding an independent and decentralised crypto like bitcoin is a wise decision imo.

(response)

The cause of the next financial crisis is a default in the credit market, look at the leverage rates in the corporate bond market, its utterly toxic, if you look at the car loans also highly toxic. The collateralization is also weaker on cars given the flooded market and substitution ease between newer and older models etc, compared to say houses when we had the 2007 crash.

China is a key risk factor with its hyperinflated asset prices based on their culture of property ownership (there are stories of men competing for women by talking about the number of properties they own, given the imbalance of men to women from the one-child policy, this sometimes requires 3 or 4 houses anecdotally)

On top of that read Thomas Picketty's analysis of the failures of the Euro given the ECB sets policy rate yet does not control individual governments debt issuance or government budgets, then the surplus recycing of the germans into higher return markets in the eurozone at low rates pumping leverage in these nations before rising rates, taking the default, refusing to bail them out and then taking ownership of their collateral.
Wait until the Italians spanish and greeks leave the EU to prevent this frankly fiendish economic-empirialism of the hun.

Also on the list:

-American-Chinese war possibility (venezuelan intervention by US leads to Chinese dumping US treasuries as retaliation and dumping the petrodollar system buying oil in Renminbi over dollars to shaft the US economy, American false flag attack on Ships testing the south china sea expanded naval territory and their built islands, US then engage in a naval and aerial war with the chinese, large naval losses an aerial losses on both sides with the chinese not doing too well, russians intervene after a week, threaten nuclear war, trade freezes and commercial shipping is targeted. world is fucked.)
-Russian energy monopoly in europe manipulating prices and basically fucking the germans with that nordstream pipeline, germany shafted.
-Failed Commerzbank Deutsche bank merger leads to a collapsed german banking system,  as we all know, the eurozone is just a set of german satilite states, if germany flops theyre all fucked, euro collapses, its just fucked.

The money has to go somewhere, always, and that same money has to be paid by someone too, always. Though the course of every economic crashes and downturns hasn't been mapped fully yet, we all know that it will always occur from time to time. Analysts and financial experts had been predicting that by 2020, another global economic catastrophe is to happen, and to what cause, we don't know. It's like people are just rehashing the same events and scenarios prior to the subprime mortgage crisis of 2007-2008, though somewhat focused on a different asset and aspect of the economy.

debt for something productive, certainly requires time for recovery. and it is not possible to be paid immediately, like investment, which requires time to make a profit. but with the right calculations and assumptions of course the debt will be repaid in accordance with the specified time

I think this debt cannot be paid immediately. These are just rumors and regulators will not be able to prosecute and punish immediately. because it will greatly affect the US economy.
And this is considered the rule of moving cash flow and it has been formed for a long time. there will be no big changes happening.

   Every debt is paid by tax payers, debt made by governments and banks. In recent history we have many bail outs:
-President Bush signed the $700 billion bank bailout bill on October 3, 2008. The official name was the Emergency Economic Stabilization Act of 2008.
-British taxpayers face 27 billion pound loss from bank bailout.
-French government in 10.5 billion euro bank bailout.
   This is not whole list, I just found couple to make it more clear. Who wants to see more can use any search engine for that.
   Debt is one problem, inflation other. Two big problems that are getting bigger with time, until we have explosion and new financial crisis. Crypto-currencies
can be a safe haven when that comes.

If the global market are going down then for sure bitcoin can never be an alternative because Bitcoin will surely fall as well.

Unless bitcoin will no longer be USD dependent and is already sustainable(which is for now not that possible)

It looks like EBC and Mario Draghi see the problems are coming
EBC will pump €720bn  in banking industry starting from September
In central banks  we trust
EBC has just finished his QE now they want to start new one
We will have flood of empty money and more debt
Rates will remain on current level or will be even  lower

But analysts said downturns across the eurozone had threatened to turn into recessions without action from individual governments and the ECB.

The central bank for the 19 euro nations said it would launch a series of targeted, long-term refinancing operations (TLTROs) in September. These are to run until March 2021 to help banks roll over €720bn (£617bn) of ECB loans and to ward off a credit squeeze that could deepen the economic slowdown


https://www.theguardian.com/business/2019/mar/07/ecb-to-keep-interest-rates-low-recession-fears-eurozone-banks

My question is who will pay for it becouse people will pay in the form of taxes

It might not favour the price of bitcoin directly as every investment and currency will mostly be affected by the crash but It'll lead to people losing faith in the fait currency resulting to them, looking for alternatives and what other option will they have than (bitcoin) cryptocurrency. Sometimes people need to learn the hard way therefore, if another crash of the system will open their eyes so be it.

There are predictions by most of the top financial analyst like JP Morgan said that there is likely for a financial crisis every ten years time and the next crisis will hit the financial market in 2020 and that will bring a  huge down turn in the financial market. Only Bitcoins has the capacity to up hold the economy in such a situation, bitcoins will not get affected with the financial crisis and infact it has the capability to boost the economy from the downturn of the financial crisis. One of the major reasons for the financial crisis is due to bad debts as people are lending money at a highest record and has no chance to pay back causing for increased bad debts.

This, bubbles are inevitable and even in a system where the amount of money is limited we will see bubbles form from time to time but when you have basically the ability to print as much money as you want and you are abusing that power then bubbles will have a tendency to form even faster and to be even bigger as everyone is trying to find some way to avoid the effects of the ever increasing money supply and the damaging effects it has on your wealth.