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Thursday, November 17, 2011

Are You This In Debt?

Crazy week.

From an article [link] sent my way from one of my brothers -
"Prior to the bursting of the credit bubble, the public was shocked to learn that our biggest investment banks were levered 30-to-1. When asset values fell, those banks were quickly wiped out. But now the Fed is holding many of the same types of assets and is levered 51-to-1! If the value of their portfolio were to fall by just 2%, the Fed itself would be wiped out."
And a friend of mine wanted to know why I was STILL buying gold and silver... LOL!

It's a short, very good article, covering derivatives and other "monopoly money" schemes - including Uncle Ben Bernanke's Quantitative Easing (sounds so mellow, no?).

Gotta go dig some more holes in the backyard...

Copyright 2011 Bison Risk Management Associates. All rights reserved. Please note that in addition to owning Bison Risk Management, Chief Instructor is also a partner in a precious metals business. You are encouraged to repost this information so long as it is credited to Bison Risk Management Associates.


Joseph said...

Good day Chief, found a great website that is an overview for those that need to learn about the credit crisis. Been referring people to go look at it when they ask questions and if they don't respond I know they didn't take a couple of hours out of their lives to learn so my time has been saved ;D

Khan Academy - Credit Crisis

The above link should take you to the Credit Crisis section but if it doesn't here is the first video in the series.
Housing Price Conundrum

All the best.

Chief Instructor said...

Joseph, much thanks. Good stuff. I didn't look at all of the stuff under the Credit Crisis, but what I did was very good at explaining what's going on. I'm going to post the link in my next post.

Thanks again.