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THE GREAT CRISIS FOR TWO YEARS, MAY BE GREATER THAN THE GREAT DEPRESSION
THE SUB-PRIME WAS JUST THE START
crisis a year ago that we were expecting. U.S. not allowed to arrive earlier to avoid flat election crisis. A year ago there, but only now allowed us to see its effects and determine its magnitude.
United States, the country most consumer in the world, owners of the world's largest debt. He saw that the average American, had trouble paying their debts, and bank assets had a small decline. (Start of the Sub Prime)
banks for years too many facilities given to the granting of loans. These easy loans were the basis for speculation in the sense of, INVEST debt. Is credible only if the assets and properties increase in value and produce huge losses if they fall in value. Invest
This philosophy of borrowing, based on speculation, it was during the years of economic growth, the basis of consumption, savings, and the system of life of the average American. DEVELOPMENT
The onset of low uncertainty caused bankers and people who master the subject. A decline in the value of the property and keep the debt means that the debt becomes greater than the value of the property, thus exacerbating the crisis and does not leave an easy out.
This combination of increased personal debt American environment and its need for cash, with frightened bankers to restrict lending. Produce a fall in asset prices and properties. (Full Crisis) The need for cash collapsed the housing market and reduced demand for shares in the stock market. Entering a spiral that increases insolvency payments deficit increases and initiates a chain of casualties.
THE DEATH SPIRAL
Well finally I had to go through, the banks stopped lending, debt packages have become difficult to collect (SUBPRIME), and started the collapse. They lowered the property value.
Summary: How would you feel if your property that cost him 100, which is 90, the bank's cup 50. And there is interested in buying it. FUTURE
According to U.S. government, there are 13 million homes that have serious problems to settle and lose their property, stop paying them, or delivered to the bank. That means you can lose everything. Of these 8 million are workers who lost their jobs and receive assistance. And 5 million are speculators who lose their homes without any help. So the crisis is not over and is expected to continue for two years. YOU ARE DOING
The latest measures include preventing the sale of 8 million properties this year. Affirming the property prices and maintaining low consumption value of this massive sector of the population of the United States.
As still being taken, we can not quantify the help of American government. Are concerned that it could be greater than the great depression of 29
ESTIMATE Based on a chart of the Dow Jones Industrial Average. In this first stage, the DJ in 8000 points to 7500 points in six months. And no chance of stopping at least one year, the Dow Jones should lose its next resistance till 4000 points, for many it seems crazy to reach the values \u200b\u200bof 1995, is impossible.
Let's see what happens, it's just a prediction. DOW JONES CHART
HITORICO.
Today the DJ is in a resistance of 8000, but since there are one or two years of crisis, break down, with a floor of 4000 is that you can halve the current value. And values \u200b\u200bof 1995.
all depends on:
- the availability of money in the U.S. (buy-outs, with high volumes traded)
-the possibility that China and India, begin to acquire assets back to find them cheap,
-China and India, increase their level of alcohol consumption visible. (Very unlikely occurrence)
THE EXPECTATIONS
whereas actions are interesting levels to buy, very few people would risk that they:
The crisis may last for two more years and the shares continue to fall. Companies submit
negative balances for 6 semesters.
For now, China will have to take advantage of cheaper growth.
China and India were unable to maintain consumption equivalent to the U.S., mainly because they were incorporated into corporate profits at the beginning of the crisis.
people's expectations, and lack of money available will not allow increases in consumption.
THE TOUCH OF GRACE FOR THE MARKET
The U.S. appearance of scammers tie, a former president of bag swindled by 50,000 million dollars, a stockbroker who swindled 10,000 million dollars (to date figure to be confirmed) .
You will not believe the damage that two people made the world's largest economy.
seasoned investors were defrauded and banks. That have information that you might not expect professionals with engineering degrees, professionals with business studies, many with MBAs and PhDs, experts in statistical handling of data, etc. They control your investments 24 hours a day, even during holidays and weekends. Maintains personnel distributed throughout the world.
can we expect our working people. Expected for people like me, that I have little information. I'm surrounded by sharks waiting for a mistake to keep all my money.
We no longer believe in the market. I know it is exaggerated, that if I buy shares they hold their value sure, but most people do not go public, even advised by banks. BACKGROUND
1 .- Bernard L. Madoff, is a former chairman of Nasdaq. He founded the Bernard L. Madoff Investment Securities, which has about 17,100 million dollars in assets under management. Half of her clients are''hedge funds'', ie hedge funds. (Professional Investor)
I founded with bad intentions and attracted promising payment of money or promising abnormally high returns, which are obtained by the company that raised the money. That is, a surround system or pyramid, which pays the promised return to the entrance money paid by new customers. Banco Santander moved
3,300 million euros with them. Money belonging to wealthy and institutional investors.
2 .- Robert Stanford securities offered to investors with the promise of high returns. It is assumed that there may be ripped off 10 billion dollars.
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