Where did all the money go ?

uscitizen

uscitizen

Villified User
The finianicla institutions seem to have lost a trillion or two worldwide. Where did it go ? it is still there somewhere.
 
uscitizen said:
try again. think some this time.
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Why don't you try thinking about it.

Money has always been but a theory - a symbol. Money has never been real. When money out strips genuine wealth, that is when economies get in trouble. That has been happening for the last several decades. We create more money without the real wealth to back it. That is where most of the monies spent by various governments in deficit spending comes from. It is created out of nothing. We need an additional $700 billion, it does not reflect reality, but rather a monetary fiction.

Were money to reflect reality, we could not pull an extra $700 billion out of some magical hat. But over the next several months that $700 billion WILL magically appear on the books, borrowed from places that magically add it to their books so that we may borrow it to add to our books. It is a game of numbers and manipulation.

But in reality, it does not exist. It is numbers in computers and on paper, bearing no relation to reality. The $700 billion making up the bail out will not come from anything but our own fertile imaginations. We will not pump any extra oil from the ground, dig out any extra precious metals or gems, nor add grain to our coffers. Nothing real will be created when we add $700 Billion to the general fund for the purposes of putting our imaginary band aid on our economy. But by unconscious consensus, the action of creating $700 Billion out of thin air will have a very real effect on reality. And all because we have forgotten that money is but a symbol. In our minds we have made our reality to based on an icon without substance.
 
uscitizen said:
The finianicla institutions seem to have lost a trillion or two worldwide. Where did it go ? it is still there somewhere.
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It's tied up in forclosed assets, right? The premise being that if we allow the banks to get desperate enough to sell the assets at a huge loss, it will drive the value of everyone's home down and many industries along with it. That's the closest I can get to understanding the mess.
 
tinfoil said:
It's tied up in forclosed assets, right? The premise being that if we allow the banks to get desperate enough to sell the assets at a huge loss, it will drive the value of everyone's home down and many industries along with it. That's the closest I can get to understanding the mess.
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among other things yes tied up in unsold houses, expanded building industry. houses in foreclosure. And mega money is even tied up houses and business construction sold / mortgaged and not in foreclosure.
Even with no bad loans too much money can be loaned out.

Gl does not have a clue.
 
A morgage paid every month has a certain value as cashflow. These cashflows have been resold through a process of "securitization". Now when the loans turn out to be bad the value of these becomes questionable, and their desirability falls, leavin money gone out of daddy's safe.
 
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