Bank of Spain chief says world faces total financial meltdown!
MADRID, Spain - December 21, 2008 -
The governor of the Bank of Spain on Sunday issued a bleak assessment of the
economic crisis, warning that the world faced a total financial meltdown unseen
since the Great Depression.
"The lack of confidence is total," Miguel Angel Fernandez Ordonez said in an interview with Spain's El Pais daily.
"The inter-bank (lending) market is not functioning and this is generating vicious cycles: consumers are not consuming, businessmen are not taking on workers, investors are not investing and the banks are not lending.
"There is an almost total paralysis from which no-one is escaping," he said, adding that any recovery - penciled in by optimists for the end of 2009 and the start of 2010 - could be delayed if confidence is not restored.
Ordonez recognized that falling oil prices and lower taxes could kick-start a faster-than-anticipated recovery, but warned that a deepening cycle of falling consumer demand, rising unemployment and an ongoing lending squeeze could not be ruled out.
"This is the worst financial crisis since the Great Depression" of 1929”, he added.
Ed. Note: The reason for the financial collapse is simple. With a reserve banking system, more money is owed than is in existence. Once the economy became global, there was no place for new money to come from to cover the accumulating interest. No foreign land to invade and loot, no conquered peoples to enslave, no more suckers to swindle with Ponzi schemes.
The Reserve system of banking is always a windfall for the people who start it, but like all Ponzi schemes it must collapse eventually, bringing ruin to all in its reach.
