Monday, June 25, 2007

BIS Warns Credit Spree Could Produce 1930s-Style Depression

What makes this report so remarkable is that is comes from the BIS. This is to my knowledge the first time that the "d" word is published from such a source.

The Bank for International Settlements (BIS) is an international organisation which fosters international monetary and financial cooperation and serves as a bank for central banks.

The BIS fulfils this mandate by acting as:

  • a forum to promote discussion and policy analysis among central banks and within the international financial community
  • a centre for economic and monetary research
  • a prime counterparty for central banks in their financial transactions
    agent or trustee in connection with international financial operations

Was das ganze so gewichtig macht ist das diese Aussage nicht von den üblichen Doom and Gloomern kommt sondern von einer Institution die sicher nicht im Verdacht steht unnötig schwarz zu malen. Meinem Kenntnisstand nach ist das die erste Publikation in welcher das "d" Wort deutlich ausgesprochen wird.

The Bank for International Settlements is warning that years of loose monetary policy have fuelled a dangerous credit bubble, leaving the global economy more vulnerable to another 1930s-style slump is than generally understood, the U.K.'s Telegraph newspaper reported on its website. Virtually nobody foresaw the Great Depression of the 1930s, or the crises which affected Japan and Southeast Asia in the early and late 1990s.
In fact, each downturn was preceded by a period of non-inflationary growth exuberant enough to lead many commentators to suggest that a 'new era' had arrived", the bank was quoted as saying. The BIS, the ultimate bank of central bankers, pointed to multiple worrying signs, including mass issuance of new types of credit instruments, soaring levels of household debt, extreme appetite for risk shown by investors, and entrenched imbalances in the world currency system, the report said

>One of the rare times i´m more optimistic than the original report....:-)

>Eine der seltenen Fälle wo selbst ich optimistischer bin als der zugrundeliegende Report.. :-)

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