Troubles ahead!
Well maybe .
Are we the consumers in trouble because most of our assets are tied up in land and stocks and other such things.
Well how are we going to pay for our consumption.
Well we can always borrow.
But if there is no liquid assets, just how are we going to pay for the things that we want to buy?
The banks hold are liquid assets and give them out to other consumers but if there is a lack of money in the banks , just how are we the consumers going to buy those cars that are being built on borrowed liquid assets (money).
If those car companies can’t sell those cars then the value of the car companies goes down.
If those car companies’ value goes down then the value of our solid assets goes down.(Just thinking.)
We and the bank lose the value of our liquid assets.
Can this be the start of a crash?
To put it in another way the debt that is piling up by the people can be worse for the economy then the debt that governments have.
Why may you ask?
Because the government can print money, we the proletariat just can’t.
************************************************************************************
Oh darn another crazy blog by Steve’s Barking, that some may find hard to understand.
I used cars but it can be real estate, clothing or anything, as it appears to this blogger that there may be just too much consumer and investor debt.
I understand that some of my readers might not understand what I mean by liquid assets.
Liquid assets are money, checking accounts, and savings accounts. ( This should be known to any one who took a basic course in economics.
One thing that scares me about the banking system is if the bank can’t turn their loans into money and their depositors liquidate assets aren’t so liquid.
