So the banks have no money, except 1 to 10 percent of deposits..

[Kokonoe]

They know that, and make financial deals with other banks based on future income from loaned money they never had, and never will have(future income).

Now the banks owe each other Trillions in worthless paper deals.
Since our banks give us money, the banks demand trillions or will stop lending money they don't have.

Can we just admit those trillions were not real.

[lynnertic]

1. spelling police: except

you must have seen Zeitgeist: Addendum - I'm in the middle of it now.
http://video.google.com/videoplay?docid=7065205277695921912

I'll say the trillions aren't real when we don't have to learn Chinese to repay it.

[Kokonoe]

3. Thank You, I just saw it.

I recommend learning a second language, its good for you and keeps some bases covered.

[lynnertic]

10. I agree. Learning however is more fun when it's out of genuine curiosity

rather than under duress.

[seemslikeadream]

8. The end is good

[Robbien]

2. And all recovery plans are based on restoring liquidity to those not real levels

A credit problem they say. No bank wants to loan money to any other bank.

Hey guys. Get a cluestick. If no one wants to a bank because it is untrustworthy, then why are we trying to restore banks back to their highly leveraged levels which are based on unreal junk?

Until they realize we can't go back, nothing they do will work.

[Kokonoe]

4. Just a few frog marches would save billions.

Of course the real schemers would get away. But we still need to do it.

[Robbien]

5. Oh come on, they still are laying blame on the disadvantaged people

who took out loans they shouldn't have taken.

And Paulson is still being fawned upon.

We are a long way from even beginning to be at the starting line for a real solution to the problem.

:shakeshead:

[TreasonousBastard]

6. ummmm... that's the way it's worked ever since...

gold merchants leveraged the gold in their vaults over a thousand years ago. Probably other similar schemes much earlier than that.

The deposit multiplier is NOT a bad thing and the money created is not vapor. Few of the things you do or use could have been created without this system.

[Kokonoe]

7. Yes, thank you

the system works great. However it seems the banks have created their own system.

Based not on vault multipliers, but multiples of home mortgage contracts.

They knew, the money in their intra banking relations was nonexistent.

[TreasonousBastard]

9. Yeah, that was a problem. Not all banks got on...

the bandwagon, though, and it just seems to make sense that when there's so much hectic activity in a sector that the regulators should take a look. I still don't know, though, just how many of the really troublesome mortgages that were brokered were with banks.

Every so often Wall Street makes the argument that it can regulate itself, and almost immediately proves that it can't. All those theories about market self-regulation just don't work in the real world. I spent most of my working life as an insurance underwriter and some companies were overly conservative, but all of us were secretly thankful for the hyper-regulation we were under-- it stopped the real cowboys out there from screwing the whole system.