George Soros: Country's Banking System "Basically Bankrupt"

bloomberg.com:

New York University Professor Nouriel Roubini said stock markets may drop and billionaire George Soros warned the "bankrupt" U.S. banking system will hamper its economy, highlighting doubts about the sustainability of the global recovery.

Read the whole story: bloomberg.com

Comments

[Chazmania]

02:32 AM on 10/10/2009

Corruption will always lead to the demise of any industry. this has been historically proven!
regulation is the only way to keep men honest! the culture of duplicity has been nurtured by our society and government and then we let them unaccounted for like we do the FED a private institution not even under government control! a puppet for the Banking MAFIA!

[SteveDenver]

12:11 AM on 10/07/2009

Bust up the big banks and reestablish controls.

Bush didn't fail, he got everything he wanted (except privatized Social Security) and look where we are now.

[anitaj]

03:05 PM on 10/06/2009

It's true the system is basically bankrupt, financially and morally.

[Rosewren]

03:05 PM on 10/06/2009

Well I'm glad to see that most of you still have your sense of humor!

[JoshPr]

12:43 PM on 10/06/2009

I predict there will be no reform or change and Obammi will discourage his followers, hence losing 2012. Dems will also lose a lot of seats in the house in 2010.

good articles; http://iamned2.blogspot.com

Obama= fail

[theaetetus]

11:42 AM on 10/06/2009

If you take what he is saying at face value we are in loads of trouble.
If you consider he might have an ulterior motive then we might be ok. Perhaps he is trying to undervalue the market so he can make more billions. I really think the prior is true, sadly.

[maxhardon]

10:49 AM on 10/06/2009

What we need now is a man like Ronald Reagan to explain things to us.

[bobo5]

10:07 AM on 10/06/2009

Mexico has been through this. Diversify. The coming inflation will be ugly.

[maxhardon]

09:14 AM on 10/06/2009

I don't understand.. I thought the banks were too big to fail.

[biwee]

07:28 AM on 10/06/2009

The same who destroyed Russia have now ruined America.
Who is next, China??

[StJames]

10:07 AM on 10/06/2009

No China has a strong economy and the banks have plenty of cash. China has a state run economy.
Any questions?

[maxhardon]

10:28 AM on 10/06/2009

China is a rich country with poor people. The US is a poor country with rich people.

[alexdog]

10:43 AM on 10/06/2009

Yes. One. What do you suggest?

[arvay]

06:51 AM on 10/06/2009

Fire Bernanke. Appoint Soros. Let's get a real economic expert in there, not some flipper-organ of the Wall Street albatross.

[jsarets]

04:20 AM on 10/06/2009

It's pointless to use the term "bankrupt" in the context of the financial system.

The financial system doesn't own any productive assets. It only owns claims on the future revenue generated by assets owned by the productive properties that employ them.

These claims are entirely speculative at all times other than the moment that a bond matures, a future is delivered, an option is exercised, a swap is triggered, or a stock company goes bankrupt.

Whether a financial institution is "bankrupt" is therefore entirely speculative. If the market speculates that its asset claims are worth less than its fixed liabilities, then it's bankrupt.

The more practical question is whether the financial system is able to pay its existing liabilities without taking on new liabilities, and the answer to that question is objectively NO.

The reason is inherent to the way the financial system works. When an interest-bearing loan is issued, only enough money is created to pay the principal. The interest must be borrowed at interest.

When there's no such thing as debt-free money, all assets are actually liabilities, and all properties are technically bankrupt. Without the assumption of new liabilities, they'd be functionally bankrupt, too.

Benjamin Franklin figured this out nearly 300 years ago and directed the Pennsylvania Colony to issue debt-free grant money equal to the interest due on loan issued by private banks.

Until King George banned its currency, the Pennsylvania Colony was by some margin the most prosperous economy in the entire world.

[condor101]

04:16 AM on 10/06/2009

Listen to Soros. He's 100% correct. His former business partner, Jim Rogers has also been saying on cnbc for the past 2 years that this is a crisis, that the dollar will be severely de-valued. He lives in singapore with his family and he divested from the dollar and is a big proponent of the chinese yuan and some european currencies (euro not included).
Listen to these guys. They made billions of dollars for their clients. They know the truth. Don't listen to those liars from the Fed and the Treasury.
The rich people have been buying diamonds and gold as protection. Is it a coincidence that gold went above $1000 an ounce? No, it's not.
wake up people and protect your assets Now.

[jsarets]

04:48 AM on 10/06/2009

Don't listen to Soros. He's 100% correct, but it doesn't matter if you work for a living, live in America, and wish to continue living and working in America.

If you're an independently wealthy citizen of the world, then by all means go along with the globalist agenda and invest in a globally-diversified portfolio of financial media jargon.

If you listen to Soros, you may protect your wealth, but you will destroy your income. You have to decide which is the more important priority for you and your family.

[topguide]

03:30 AM on 10/06/2009

since 1980, we've had only 1 Democratic President who balanced the budget and 3 Republican presidents engaging in vodoo economics and skyrocketed the deficit.

since 1980, congress has been under the clutches of Republicans more often than under Democratic control.

Should we blame the Republicans for this mess?

Or should we blame the average voter who put these Republicans into office?

[jsarets]

05:16 AM on 10/06/2009

Oh, please...

The financial crisis is the most bipartisan of all of our various slow-motion train wrecks.

That Clinton balanced the fiscal deficit at the urging of Goldman operative Bob Rubin only suggests a slightly less sophisticated understanding of the financial system.

But, as far as see, nobody in Washington has any clue how the financial system works.

The fiscal deficit is an essential feature of our broken financial system. It's the best way to create the interest that banks don't issue while generating a minimum of new interest.

Every year, the financial system demands over $1 trillion more money than it creates. Short of issuing debt-free money, we're best off borrowing the difference at the lowest interest rate we can get, and nobody pays a lowest interest rate than the federal government.

[jsarets]

05:26 AM on 10/06/2009

If we don't let the federal government borrow this immense sum of missing money, then Goldman Sachs will be more than happy to lend it to us at a substantially higher interest rate.

Get it?

[senorlou]

01:22 AM on 10/06/2009

At this rate, we're all going to end up naked and starving in the woods. Somebody has to put the clamp down on Wall Street and the banks. The fools have started up the doomsday machine again. They do not learn.