By: Julie Crawshaw
For more than 10 years, millions of Americans ran their own personal Ponzi schemes, says NYU economist Nouriel Roubini.
"When you put zero down on your home, and you thus have no equity in your home, your leverage is literally infinite and you are playing a Ponzi game," Roubini writes in Forbes.
It’s a game virtually everyone played, Roubini notes. That’s how we became the United States of Ponzi.
Banks made interest-only, zero down payment liar loans to NINJA (no income, no jobs and assets) borrowers at initial teaser rates.
Private equity firms did over a $1 trillion of leveraged buyouts with a debt-to-earnings ratio of 10 or above.
Consumers allowed their debt relative to income to soar to 135 percent today from 65 percent in 1994.
“An economy where the total debt to GDP ratio (of households, financial firms and corporations) is now 350 percent is a Madoff Ponzi economy,” Roubini says.
All of which led to the United States to become the largest net foreign debtor in the world — and possibly defaulting on its foreign debt.
Link
Second Largest Mall owner Faces 5 PM Deadline
by CalculatedRisk on 3/20/2009 11:12:00 AM
In addition to watching for bank failures this afternoon, the 2nd largest mall owner in the U.S. - General Growth Properties - is facing a significant deadline:
From the WSJ: General Growth Shakes Up Executive Ranks
[General Growth's] most critical deadline is 5 p.m. Friday, when it hopes the majority of its bondholders will have agreed to refrain from demanding payment this year on $2.25 billion in bonds. If that effort fails, General Growth says it might need to seek Chapter 11 bankruptcy protection.
List of malls here:
Is your mall here?
Nouriel again is right on. the usa was -is one big ponzi from its beginning. we need more bodies to consume more shit and on and on. now we are at the end of the ponzie and its world wide." the end of living the beginning of survival" and soon there will be blood. major social unrest. thats why northcom the 3 rd army has the usa surrounded! the end of this ponzie came because of overbreeding. o7 was the highest birth rate in the history of the usa. the usa by the way is not amercia as there are 3 americas. north we are a small part of - central and south. situation hopeless. rememeber all thru history the bigger gun wins. good luck lemmings!
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