The next financial crisis is fast approaching

MarketWatch/Willem Buiter

Repost from 10-8-2021

photograph of many $100,000 stacks of $100 bills

“Central banks need to prepare because global stock markets and real estate are overvalued, while leverage is near record levels for households, corporations, banks and governments.”

USAGOLD note: Buiter’s prescription for dampening the effects of another possible debt implosion are not a whole lot different from what the central banks are doing now, and have done consistently since 2007 – print money, buy up debt, bail out the financial system, limp along to the next financial crisis, and hope it is not the ultimate meltdown. “I hope (and expect),” he writes, “that central banks – not least the Federal Reserve – are ready to respond appropriately if the U.S. federal government breaches its ‘debt ceiling’ on or around Oct. 18.” He goes on to warn of dire consequences if the response is other than appropriate saying that Moody Analytics estimate of 6 million U.S. jobs and $15 trillion (!) in private wealth being destroyed “strikes me as optimistic.”

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