Reply #2: The great unspoken outcome will be banks failing....

[Blackhatjack]

If credit capital used by Banks to lend dries up, there will be no way to sustain current banking obligations. Banks will be doing two things almost immediately --calling in every obligation they can(just like covering a margin call from your stock broker), and new loans will become non-existant regardless of the ability of borrowers to meet new credit standards.

The other unspoken outcome is that there are a boatload of financing commitments that lenders are on the hook to underwrite(because many projects have already been started in reliance upon them) which they will be unable to fulfill. THis will lead to lawsuits, and have a 'ripple effect' throughout the housing and commercial building industry.

And the debt held by banks today is worth less than at any time in the last 6 years because of the devaluation of the dollar.

If you are a banker today you probably should be dusting off your resume.