We're about to fall of the cliff... Again.

itsmickdundee

Looks like phase 3 of the credit crunch is shortly on it's way.

There are some rather concerning rumours flying around that the IMF itself is going BUST - not least hinted at by Gordon Brown last night.

The EU and USA are now asking China and the middle eastern oil countries to prop up the IMF with injections of capital - otherwise most of Eastern Europe (and Iceland) will be going back to pre-communism anarchy.

Added to this really positive stew is the realisation that the USA could soon be facing 0% interest rates - with speculation that the interest rate could go NEGATIVE:

http://www.ft.com/cms/s/0/ee7429ae-a5e0-11dd-9d26-000077b07658.html?nclick_check=1

Bye, bye dollar.

And thanks to the German government purposefully leading some large hedge funds down a dead alley, and then stabbing them in the back when they were least expecting it - doling out exactly what the hedge funds have been doing for years now - with the hilarious VW debacle. We could now see the collapse of some huge investment houses.

Laugh now, but this is like congratulating someone for burning your house down, while laughing as they get arrested.

You see, the money lost by these hedge funds will most like be peoples pension money. Made worse is the fact that the last time a major hedge fund went under (in the USA) - Long Term Capital Management back in 1998 - it was bailed out using TAXPAYER money.

So who has the last laugh yet again? The fund managers. So we all make triple the loss. Pension fund: lost. Taxpayer money: lost. Jobs: lost. While the fund managers run off to the Carribean to take full advantage of those tens of millions they stashed away for a rainy day!

It will make the looming recession seem timid in comparison.

Merry xmas fellow tax payers!!

Paul_Herring

itsmickdundee wrote: »

While the fund managers run off to the Carribean to take full advantage of those tens of millions they stashed away for a rainy day!

You started off well, but descended into hyperbole towards the end.

I rather suspect that if those fund managers did have 10's of millions, they wouldn't all be in cash; most would be in equities that have, erm, well as you said. Dropped.

ashcarrot

What would happen if rates went negative if you had a tracker that didn't have a lower bound would you actually get money for having debts?

Reaper

itsmickdundee wrote: »

with speculation that the interest rate could go NEGATIVE

People are seizing on that line but the article says no such thing. Firstly it is talking about the US not the UK, and secondly interest rates can't go negative. From the article:

the Fed – which cannot cut nominal rates below zero

It says inflation can go negative, but we all know that.

outof

If you've got a pension with hedge fund exposure then more fool you and you got a sufficiently complex product that you ought to have known what you were doing.

wombat42_2

The Big Danger Is That Deflation Will Flip Over Into Inflation Or Hyperinflation In A Year Or Two.