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An Interesting Analogy to Say the Least...

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Submitted by gretavo on Thu, 2009-03-19 19:30.

Haircut Time for Bondholders
by Mike Whitney | March 13, 2009 - 2:34pm

"The only function of economic forecasting is to make astrology look respectable."
-– John Kenneth Galbraith

When George Soros recently said that the financial system had “effectively disintegrated”, it caused quite a flap. But Soros was not exaggerating. The financial system has disintegrated. What we are experiencing now is just the fallout from that event. This is easier to understand by using an analogy. Imagine watching the demolition of a hundred-story skyscraper. After the explosives detonate and the building implodes, the chunks of debris and the shattered glass begin to fall to the ground below. That’s where we are right now. The financial super-structure has already been blown to bits, but a thick shower of fragments keeps raining down on earth. Rising unemployment, falling consumer confidence, severe contraction of the economy, growing pessimism; these are all the knock-on effects of a full-blown system collapse.

http://www.smirkingchimp.com/thread/20736

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