/biz/ - Business & Finance

Every market analyst's consensus right now is that all systemic crisis have been averted.

.......
It was the same in 2008 when the same shit happened. Literally right up until the end of september they were all saying "everything is fine! Everything is fine! We're long on everything!" And then boom the markets flash crashed on day toward the end of the month. Sept 29th I think it was.

It was the exact same scenario. High rates, then the rates got cut due to instability, which led to bailouts early on. People forget the bailouts started happening at the beginning of 2008. In March was the biggest one. Lehman got bailed out in March of 2008 before collapsing again.

Now all of that happened in a low rate environment, because the fed had actually dropped the rates down to nothing like a year before.

NOW in this situation we have all of this financial instability and bailouts with the rates still high. BUT now inflation is high too so the fed is likely planning on HIKING rates even further. Market consensus right now is still that there will be a 25BPS hike coming on wednesday

So WTF because we're objectively in a MUCH worse situation than 2008.
And in this case the fed is printing money to pay for all of these bailouts, which leads to more inflation, which leads to needing higher rates. It's a spiral like a wage-price spiral, but it's an inflation-printing spiral otherwise known as one of the major causes and characteristics of hyperinflation

The total liability burden of Credit Suisse is almost as much as the total GDP of Switzerland.
Their federal budget is almost nada.
Their total federal tax income is less than 100billion USD annually.
They have no significant regulatory framework, like the fed, to step in and stop a banking collapse that I'm aware of.
It gets worse:
They have something called a "debt brake" which will actually prevent them from overspending even in a situation like this.

So unless I'm missing something and they have some regulatory framework or plan to somehow fix this mess, there is such poetic beauty to knowing that lolbertarianism will be the thing that deals the final deathblow to capitalism.