Just when you think it can't get worse, it does. Just when you hope it might be remediable, you understand it's not.
"How far down the ruinous path has the United States strayed? Mr. Alasdair Macleod, economist: The day of reckoning for unproductive credit is in sight… Malinvestments of the last 50 years are being exposed by the rise in interest rates, increases which are driven by a combination of declining faith in the value of major currencies and contracting bank credit. The rise in interest rates is becoming unstoppable…The interest bill is already growing exponentially… Clearly, it won’t take much more of a credit squeeze and the increasing likelihood of a buyers’ strike to push the interest bill to over $1.5 trillion…Irrespective of central bank policy, the shortage of credit is driving borrowing rates higher, and the cost of novating maturing debt is rising, if the credit is actually available — which increasingly is rarely the case. It is an old-fashioned credit crunch, not really seen since the 1970s. And it has only just started… The big picture is of an asset bubble which has come to an end. And by any standards, this one was the largest in recorded history. It is our sincere hope this fellow is wrong. It is our profound fear this fellow is correct."
