I notice these comments everywhere now. It's some rhetorical sleigh of hand that the absence of a refutal leads to a false assumption that their claim is obvious and needs no support.
I mean, I've certainly used these cheap rhetorical tricks myself offhand, but I'd at least try to avoid using it when vagueposting something this out of pocket.
Yes, but it appears that the banks are not over levered like they were during the housing crisis. They will take a hit, but presumably will not need bailing out.
> Yes, but it appears that the banks are not over levered like they were during the housing crisis
Banks weren't over levered back then either because all the mortgages went straight into CDOs held by other people/institutions.
The problem was that nobody trusted each other because Lehman could just fail. So they stopped lending to each other (like the daily loans they give each other). Trust evaporated and the whole system stopped dead in its tracks.
And the funds that were over-levered were just barely over-levered. One of the funds that failed had 97% coverage. But that's enough to trigger a run -- you pull your money out ASAP to ensure you're part of the 97%, not the 3%.
This was true last year, but it would be risky to assume it remains true from one week to the next.
The rate of growth in this sector is "1. move so fast legislators can't keep up; 2. keep going until you hit a limit, then find a way to hack around that limit; 3. GOTO 2".
Not the person, but I think a corporation, whose main business is or a sizable part of the business is, that hands out money that you then owe them, is called a bank.
No, banks are something fundamentally different, If you loan someone else your own money, you are just a creditor. What makes banks special is they loan out other peoples money (deposits)
I've got news for you on how the economy works.
Well don't leave us hanging, what's the news?
I notice these comments everywhere now. It's some rhetorical sleigh of hand that the absence of a refutal leads to a false assumption that their claim is obvious and needs no support.
I mean, I've certainly used these cheap rhetorical tricks myself offhand, but I'd at least try to avoid using it when vagueposting something this out of pocket.
They borrow the banks money to owe to each other?
Yes, but it appears that the banks are not over levered like they were during the housing crisis. They will take a hit, but presumably will not need bailing out.
> Yes, but it appears that the banks are not over levered like they were during the housing crisis
Banks weren't over levered back then either because all the mortgages went straight into CDOs held by other people/institutions.
The problem was that nobody trusted each other because Lehman could just fail. So they stopped lending to each other (like the daily loans they give each other). Trust evaporated and the whole system stopped dead in its tracks.
Leverage is not the only thing that matters...
And the funds that were over-levered were just barely over-levered. One of the funds that failed had 97% coverage. But that's enough to trigger a run -- you pull your money out ASAP to ensure you're part of the 97%, not the 3%.
https://www.bloomberg.com/opinion/newsletters/2026-10-29/run...
This was true last year, but it would be risky to assume it remains true from one week to the next.
The rate of growth in this sector is "1. move so fast legislators can't keep up; 2. keep going until you hit a limit, then find a way to hack around that limit; 3. GOTO 2".
On money. How about stocks?
Not the person, but I think a corporation, whose main business is or a sizable part of the business is, that hands out money that you then owe them, is called a bank.
No, banks are something fundamentally different, If you loan someone else your own money, you are just a creditor. What makes banks special is they loan out other peoples money (deposits)
Pyramid scheme?
You’re not wrong.