Re: Economic meltdowns in SF

On Tue, 18 Mar 2008 11:04:43 -0400, "Steven L." <sdlitvin@[EMAIL PROTECTED]
>
wrote:
>Jasper Janssen wrote:
>> On Mon, 17 Mar 2008 11:19:22 -0700 (PDT), Mark_Reichert@[EMAIL PROTECTED]
>> 
>>> I know I should be avoiding reality here, but given the implications
>>> of Bear Stearns if the other investment banks are just as ridiculously
>>> leveraged, I was wondering what SF stories have which SF stories have
>>> had economic bad times as background and which have actually dealt
>>> with the economics as subject material.
>> 
>> Every single bank in the world is ridiculously leveraged. That's what
they
>> *do*. It's what they're *for*. None of them can survive a large enough
>> fraction of their account holders demanding cash, and the liquidity
>> reserves for such eventualities are mandated by the regulators at a
>> certain level and none of them have much more.
>
>But Bear Stearns was not a "bank."  It was a commercial investment 
>brokerage firm that got into the moneylending business after the recent 
>repeal of the Glass-Steagall Act, which had kept the banks and the 
>brokerages essentially separate.  

You mean every news report I heard about a "business bank" was essentially
wrong, or at least deeply flawed? Colour me surprised.

>Modern economists like Greenspan had suggested that with a global 
>economy, the Glass-Steagall Act was obsolete and could be safely 
>repealed.  Maybe now they'll reconsider.

Maybe, but I somehow doubt it.

Jasper