Dig
this post from Carpe Diem showing that lending hasn't dried up and in fact has continued to grow. Here's one of the graphs.
"Total Loans and Leases at All Commercial Banks" reached an all-time high of $7.026 trillion (reported weekly) in mid-September, going over $7 trillion for the first time in history.
The best explanation for this came from the comments section of that post, submitted by
Kentucky Packrat.
How can interbank lending be frozen while other types of lending are ok?
It's a sign of the CDS meltdown. The banks trust their customers to repay their debts more than they trust each other to stay solvent.
Hmmmm.
1 comment:
This is exactly my problem with the whole business: not so much that people can't decide what to do about the "crisis", but indeed that they are quite unclear about what the "crisis" actually consists of.
It's hard to solve a problem when you can't articulate exactly what the problem is, or why it is a problem.
I'm reminded of "black monday" (no, not the one in 1929, the one in 1987). People were in a raving tizzy about it, going on about how it was the end of the world and we were doooomed . . . and then, nothing much happened. Some people lost their shirts in the stock markets, but others made out like bandits buying stocks from them for cheap, and the rest of the economy just kind of trundled on like usual.
Ever since then, I've had a hard time getting concerned about what the stock market was doing.
The thing is, in Congress we've got a situation where only about half of *each* party was supporting the bailout plan. *Neither* party was unified on this. This tells me that there was some stuff that was deeply wrong with it that had nothing to do with the party platforms.
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