US Subprime Crisis Costs Global 7.7 trillion Dollars: Bank of America

[Purveyor]

Source: Agence France-Presse

NEW YORK (AFP) — The meltdown in the US subprime real-estate market has led to a global loss of 7.7 trillion dollars in stock-market value since October, a report by Bank of America showed Thursday.

The crisis, which has spread beyond US shores to banks and other sectors worldwide, is "one of the most vicious in financial history," according to Bank of America chief market strategist Joseph Quinlan.

Quinlan said in the report that the losses are worse than any in the past few decades, including Wall Street's Black Monday of 1987, the 1999 Brazilian real currency crisis and the collapse of hedge fund Long Term Capital Management (LTCM) in 1998.

An analysis by the US bank showed that in the most recent episode linked to subprime, or high-risk, real estate loans to people with shaky credit, world market capitalization was down 14.7 percent three months after a peak in late October.

--
The losses were also greater than those suffered after the September 11, 2001, terro attacks, the Asian financial crisis starting in 1997, Argentina's default on its debt in 2001 and the 1994 Mexican peso crisis.

"It could take months or even years before Wall Street and others get a handle on the true cost of the US subprime meltdown and the attendant global credit crunch," Quinlan said.


Read more: http://afp.google.com/article/ALeqM5iwvtjRjCsY3ZId92jo8...

[Amonester]

1. The current capitalist system is broke.

The capacity to produce goods has never been this big (although that same capacity creates more environmental problems).

So what's the point of producing them if nobody can afford to buy any?

1929?

[Ghost Dog]

3. Meaningless 'consumption' and endless 'growth'

promoted/required by this system are also driving everyone CRAZY

[Viva_La_Revolution]

2. get ready. nt

[Ghost Dog]

4. "In the end, the current financial crisis is one for the record books

and one, more ominously, not over yet."

This is just the beginning of the beginning, so far.

Greed must be outlawed (again), and natural, sustainable balance restored.

[Joanne98]

5. But where did the money go? It didn't just disapear!

[eridani]

6. Actually, it did

When financial machinations get disconnected from the economy of real things, that tends to happen. Having my house increase or decrease in "value" has nothing to do with reality. If I spend money on fixing it or improving it, its use value (that is to say real value) goes up. That's the only thing that matters to people who think of houses as places to live instead of as ATMs.

[formercia]

7. Greedy bastards screwed themselves

and everyone else in the process.

Bail them out my ass. Throw them in jail.

[Zorra]

8. Financial institutions are economic terrorists. They deliberately caused

all this damage to millions of people. The greedy corporate executives responsible for this mess should be declared terrorists and be prosecuted as such.

And anyone that says "but they didn't know!" should tombstone themselves for their naivete.