Friday, September 19, 2008

So that's the plan...

.... distort the markets. Actually, the shorts are NOT having an effect - its the holders of shares that were & are selling because they don't believe what the FSA in particular tells them.
The US removing dead mortgages onto its books will of course have the best possible effect - but it probably also means that the US, which was teetering on the edge of bankruptcy, is now bust. Sovereign states can't go bust? Tell the people who lent money on that premise in the 70s. China is making its move. Watch for a huge increase in Chinaphobia Stateside.
The plus point in all this is that this move will effectively inject gigantic sums into the banking system - which will enable the $180billion ( plus all the rest that noone has bothered to add up) to be repaid. In essence, its another recycling, but with a huge increase in available credit.
It'll take time to work through, but this "should" be the bottom. Buy that US property now before the deals dry up.

1 comment:

Whispering Walls said...

Yes we'll see if US debt is eventually downgraded