If you asked the average person what caused the stock market crash and financial crisis in 2007-2008, they’d probably say that it was caused by the banks who were giving out subprime mortgages to anyone who wanted one, even if they didn’t have a job or the money to pay the mortgage.
But that’s not really the case. The real culprit is the Federal Reserve’s loose monetary policy and low interest rates, which caused the crash. Does that sound familiar? It should.
Since the financial crisis/meltdown central banks have done the exact same things! But to a MUCH larger degree.
Massively suppressed rates, and even LOOSER monetary policy has
- Inflated the largest debt HYPERBUBBLE in history which in turn has
- Reinflated THE MOTHER OF ALL STOCK MARKET BUBBLES.
- CREATED A REAL ESTATE SUPERBUBBLE BEYOND ANYTHING WHICH HAS EVER BEEN SEEN BEFORE, and,
- Set the stage for another worldwide financial crisis which will eclipse the last one by exponents.
A MAJOR underlying component of what caused the financial crisis to unfold into a world-wide meltdown event, came down to liquidity drying up.