Friday, 22 October 2010

Banks and corporations: the bigger they appear, the harder they'll fall

Debt is the problem. Debt is going to destroy anyone and anything that is in its path -- so you'd better try to get out of the way as fast as you can! Given than all of the world's national currencies are debt-based, this has some serious implications that are set to affect every one of us.

I was just reading a post from Mish (here) discussing the nonsensical notion there is a wall of cash "on the sidelines, waiting to enter the stock market". It's an interesting read in it's entirety and I recommend it to you.

However, I thought something in the article was of particular interest and perhaps would make the picture a lot clearer for people, so I figured I should post it up for you to see it. It's an interactive tool for analysing how much cash and debt is being held by the top 50 US corporations. If you are not already quite clear on how bad the debt problems (private as well as public) are, then I think it is worth you taking a couple of minutes to look at this information below.

Once this tool has loaded, simply hover your mouse over the bar (not the title text) for, say, Bank of America, JP Morgan Chase, or Ford Motor. Take a look at the numbers that pop up -- I think you might be more than a little surprised at what they tell you about the health of these purportedly healthy and powerful corporations. It should tell you all you need to know about the precarious state of the global economy in general, engorged on wholely unpayable debts that continue to get only worse as time passes. Something has to happen to change this, either some radical change of path that is nowhere visible on the horizon so far, or something violently goes BANG sometime and very likely sinks the whole global economy with it, in a massive chain reaction of broken promises and debt defaults. Who is looking after your "money" at the moment? Are they going to give it back to you when you need it? Will it still be worth anything?

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