BIS annual report is frightening reading
The BIS report is long, very long, and very frightening. You may not take much notice of them, but the Bank for International Settlements is the club of central bankers – the equivalents of Mervyn King round the world. You should pay attention, as they sit in the engine room of the world’s financial system. And, in a nutshell there message is this: if, as is not impossible, we undergo another banking crisis there are many governments in the world who will simply not be able to afford to rescue their banking systems like they did in 2008-09. Including Britain.
If that happens, I should add, it means frozen cash machines, collapse of payments systems and a slump. It is scarcely believable, but we really are running out of backstops. If the US and the IMF run out of cash we can hardly ask Mars to come in and rescue us. The second credit crunch may easily be harder than the first; in which case countries with solvent governments will be a more secure place to live. Sadly, that may not include Britain, which has big debts and an even bigger banking system.
Don’t say you weren’t warned…Tagged in: banks, bis, credit crisis, recession
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