THE World is now DERIVED - Time to SETTLE SOVEREIGN DEBT

The financial "crisis" is Not over. We're just getting more used to the word crisis and it doesn't seem so bad anymore. What I mean in the title is that the whole world is now running purely not just on debt, but on derivative securities based around that debt, and sold by the big banks to cover losses on their debt. The whole sub prime crisis was caused by a vicious cycle of mortgage originators, signing up people who really shouldn't be in a mortgage, who didn't have reasonable down payments and who were highly likely to default. But that didn't matter, because the mortgage originators just wanted the paperwork, which they sold to banks like Citi and Bank of America who snapped them up and then bundled thousands of them together and sold securities based on the income from those debts. When the economy and real estate bubble collapsed, the loans went bad, the buyers of the securities enacted buy back clauses and the banks had to repurchase securities, and thus took massive losses when the underlying value of the securities took a dive. The banks held both [asset and the security] as they foreclosed on the properties and assumed them.

The big question now is : WHAT IS the REAL VALUE of our ASSETS? There's a lot of talk about sovereign debt now [money that whole nations owe] and Europe is in big trouble because many countries are tied to a common currency, the EURO. Ireland just entered into a value slashing exercise with its banks and big banks were effectively nationalised to save them and the underlying business, I mean, these are still people here buying a family home. One big problem still is the overvaluing of assets to help relieve the pain of the real losses. Banks need to do it, developers, and sovereign nations all need to revalue, and ultimately provide restructuring plans that conclusively address the debt situation going forward.

THERE'S NO MONEY LEFT IN THE WORLD. Its all been spent. Everyone is in debt and is trading on their "future". That is, you have a job and you will work, and you will repay what you owe in the future. ALL the big companies in the world are in debt and have not managed it well, because debt was good, debt was essential. Iceland citizens all owe thousands and thousands of dollars because their government screwed them with IceSave and other failed activities which owe billions.

Those who are committed right now have little option but to ride out the wave in their asset value, and hope they have the ongoing resources to hold out on those assets till they regain value. Unfortunately the toxic assets [those bad loans ] are so rampant, and then added to that is this anticipated commercial loan default problem (many strip malls and condo developments and casinos etc), that mnay banks will still fail, and the bankruptcies are going to rise. Whole nations are set to default and there will be great pain and suffering as the playing field is levelled and the whole game is reset.

The banks have sold us all a lemon, everyone owes money, and its time to pay the piper.