The Return of Crisis: Everywhere Banks are in Deep Trouble
Chris Martenson
Financial markets the world over are increasingly chaotic; either retreating or plunging. Our view remains that there’s a gigantic market crash in the coming future — one that has possibly started now.
Our reason for expecting a market crash is simple: Bubbles always burst.
Bubbles arise when asset prices inflate above what underlying incomes can sustain. Centuries ago, the Dutch woke up one morning and discovered that tulips were simply just flowers after all. But today, the public has yet to wake up to the mathematical reality that over $200 trillion in debt and perhaps another $500 trillion of un(der)funded liabilities really cannot ever be paid back under current terms. However, this fact is dawning within the minds of more and more critical thinkers with each passing day.
In order for these obligations to be reset to a reality-based level, something has to give. The central banks have tried to modify the phrase “under current terms” by debasing the currency these obligations are written in via inflation. Try as they have, though, they’ve been unable to create the sort of “goldilocks” low-level inflation that would slowly sublimate that massive pile of debt into something more manageable.
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http://www.counterpunch.org/2016/02/10/the-return-of-crisis-everywhere-banks-are-in-deep-trouble/