On 27-Oct-08 16:30, Invisible wrote:
>>> So, seriously, does the entire world really fall apart in a few weeks 
>>> just because one nobody company goes bust? Or is there something 
>>> bigger going on here?
>>
>> A couple big banks in the US crumbled. Apparently they're taking the 
>> rest of the world with them.
> 
> That makes significantly more sense...
> 
> (Random: Is the USA actually *the* richest nation on the face of the 
> Earth? Or is there somebody richer?)
> 
It is rich only for a certain value of rich. If you look at the curve of 
the debt of the government it has been steadily rising fast (ok, it 
leveled a bit of at the end of the clinton era). What this government 
did is use taxpayers money (that they didn't have) to buy a lot of goods 
from american companies at possibly slightly inflated prices (mostly war 
and 'terrorism' related. e.g cruise missiles, blackwater). So a group of 
wealthy americans (with the right friends) got much richer indeed. It is 
effectively a way to let a lot of people pay a bit (in taxes) and give 
it to a few. There were sound economic reasons for that, but I can't 
remember which. The Bush administration will continue adding to this 
shift in money by spending and allocating lots of more money soon a) to 
increase the change of mccain winning and b) if he looses to prevent the 
next government to be able to keep their promises. Or perhaps they did 
that already.

So, some people in the country are rich. You might say that the country 
as a whole is rich too (in goods at least, but also in debts). The 
government OTOH is more or less bankrupt, except that that can not 
happen because the dollar is the world currency.

See indeed that googledoc thing for some explanation on how the rest of 
the world got involves. Add to that that nobody knows who owns the good 
stuff and who owns the rubbish. Hence Bank A will not lend to Bank B, 
because it is not sure if Bank B actually can pay the loan back. 
Governments around the worlds are now backing the banks, saying that if 
Bank B should turn out to own the rubbish, they will pay back the loan.

BTW in case you were wondering, I don't know how much of this is true 
and how much is propaganda ;) Read a book about this crisis in 50 years 
time (if you are still alive), maybe that will be more objective. 
Possibly not, that depends a bit on who will be winning.

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