Financial Crisis

When there is a loss of confidence in financial assets, investors around the world sell them at the same time, which results in a financial crisis. These assets will, of course. be worth a fraction of what they were before. Financial institutions that own these assets may not have enough money to cover them. This causes financial institutions not to lend to people, because they have no liquidity. Without credit available in an economy from financial institutions, an economy contracts.

This is how a financial crisis translates into an economic contraction. This is why governments step in to provide liquidity to the banks—quantitative easing—in order to keep the economy from further contracting on itself. A financial crisis can bring an economy to its knees. The government’s job is to ensure there is no loss of confidence in the first place, because this is what triggers a financial crisis.

Economic Collapse: Marc Faber Says This Should Terrify Investors Everywhere

By Friday, September 18, 2015
Economic collapseThe Federal Reserve’s reckless monetary policies have created a colossal asset bubble, which could trigger a stock market crash and global economic collapse in 2016. At least, that’s the opinion of famed market commentator Marc Faber. In an interview with CNBC on Wednesday, the editor and publisher at The Gloom, Boom & Doom.

Economic Collapse: Japan Downgrade Could Spark the Next Stock Market Crash

By Thursday, September 17, 2015
Japan DowngradeMoody’s and Fitch did this last spring. Standard & Poor’s (S&P) has joined them by downgrading Japan’s economy rating from AA- to A+, sending a strong signal that the rating agency is not bullish on “Abenomics” pulling the country out of economic collapse mode. All this despite the “promising start” after Prime.

5 Reasons Why the Global Meltdown is Just Getting Warmed Up

By Thursday, September 3, 2015
Global Stock Market CrashLate last year I wrote an article suggesting the U.S. could enter a depression in 2015. To some it sounded farfetched at the time. After all, the stock market was at record highs and investors remained bullish. But it seemed to me that all the economic evidence pointed to a U.S. financial crisis. I think the same conditions are in play. In .

Economic Collapse: This Could Lead to a Stock Market Crash in 2016

By Tuesday, August 4, 2015
Stock Market Crash in 2016Less than a decade after the biggest financial crisis since the Great Depression, over-zealous central bankers are risking a second economic collapse. The continuous credit creation and rock-bottom interest rates in the U.S., China, the EU, and Russia are meant to incentivize lending, but really they are engineering a second, much.

Global Debt Levels are Leading to a Financial Crisis

By Tuesday, July 21, 2015
Financial CrisisAs the Greek debt crisis winds down, world markets are reverting to business as usual without acknowledging a fundamental truth: Greece was only the beginning. Many countries have used nothing but debt to fuel their growth, laying the groundwork for a mega-sized economic collapse. A key study by the International Monetary Fund (IMF).

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From: Michael Lombardi, MBA
Subject: Golden Opportunity for Stock Market Investors

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