What would a US financial collapse mean?

[Vortex]

Would a collapse of several US banks hurt us here?

What would be the effect of such problems in the US and in Europe?

[MacG]

I think it's impossible to predict - the system is to complex and interconnected - it's like predicting weather or something.

Generally speaking, a US collapse would give the politicians and leaders in the rest of the world a lot of help with legitimacy and maneuverability - it's not THEY who screwed up, it's the US.

[mobbsey]

Would a collapse of several US banks hurt us here?

Yeah, all that globalised cross-ownership and leverage funds takeover stuff is a bit of a bugger isn't it!!

The bigger question is whether it affects just the Starbucks and the tanning salons, or more fundamental things such as the onwership of the agribusinesses that have mopped up land across the UK as farmers have retired.

[peaky2]

The bigger question is whether it affects just the Starbucks and the tanning salons,...

The newest street (re)built here in Brighton is Jubilee Street. Our super new eco-library is there and a huge square of empty concrete in front of it. The whole right hand stretch of the road was a set of 'available retail units' and the left, well just sort of open. Now it's nearly all occupied -

One side: Carluccio's, Property office, Tesco Express, Sushi bar, Tex Mess (sorry, Mex), B & O showroom. The last shop in the row was the first to open - Starbucks. Now the two in between are nearly done - a hairdresser and a tanning salon complete the lineup.

Other side: 2 empty units, the Library, Pizza Express and a spanky new 'boutique hotel'.

Ah, local business is thriving in Brighton and Clone Town Britain (Brighton?) nowhere on the horizon.

[biffvernon]

You need Locavores

[nepenthean]

Well, I'll keep you informed as I see things occur here.

[SunnyJim]

Yeah, I think a collapse there would affect us here. We have a 'special relationship' don't we?

Our equities markets seem to react strongly to wall street. A collapse of Fanny Mae and Freddie Mac would send shivers round the world.

Hard to see where all this is going actually.

I wonder if this credit crunch isn't in fact caused as much by PO as it is by 'sub-prime' lending. I wonder if the banks (certain individuals) aren't seeing a long term economic decline, and so would understandably not want to lend any money under such circumstances. Unless there is a very high deposit to loan ratio, i.e. high deposit mortgages.

It will be interesting to see if they can work out some kind of way of either;

a) Finding new growth. Notice that toad Ban Ki-Moon is desparate to get Africa enslaved again. Get long term food contracts in place so that African's are contracted to sell food to big western companies, and then the African farmers will attract investment. What this actually means is that we get the farmers to sign contracts to sell us their food, then when they have a guaraneed income stream the western banks can lend them money for 'technology' which will enslave the African farmers so that they must provide the west with ever more food, the proceeds of which, they will just about be able to buy enough of the west's surplus crops to stay alive. Clever....

b) Change their working model to not rely on growth. Maybe banks will simply rely on rent from all the assets they will reposess?

It's all a bit worrying really. Much overdue, but a bit worrying.