Thursday :: Aug 23, 2007

Open Thread


by Mary

What do you understand about the subprime crisis? Understanding what factors led to this state is not easy even if for those who understand the economy. The best piece I've read about how the problems came to be is here.

Update: Atrios is right. Bernacke has very little say in this chaotic moment because the leveraged debt is outside the systems he controls. Rare news stories do make that point.

Well unfortunately, the world's secret for combating this fear doesn't lie with the Central Banks right now. The problem that's driving all this unease is that nobody knows where the subprime loses are.

The Central Bank and the Fed do not regulate the hedge funds nor other specialized investment systems and no one knows what's going on inside them until they make a declaration. That's why this is such a messy situation.

This thread is now open for business.

Mary :: 12:00 AM :: Comments (10) :: Digg It!