Now, the thing is, we’ve come within hours or days of total global financial gridlock, total market collapse in the last 14 years. Everyone knows about 2008. People have a sense of that.
But it also happened in 1998 as a result of the Russia default and the collapse of hedge fund Long-Term Capital Management. At the time, I was involved with Long- Term Capital Management…I actually negotiated that bailout. I was in the room. I saw the $4 billion moved into our bank accounts to prop up the balance sheet. The money came from Wall Street. But there was a lot of give and take that almost didn’t happen and we were literally hours away from markets collapsing. We muddled through that. We kind of found the runways and got through.
But, people learned all the wrong lessons. Instead of banning derivatives and backing away from
So, we said,
Morgan Stanley would have been next, Goldman right behind it and then Citi then Bank of America and then J.P. Morgan — so all the
- Source, Jim Rickards, via The Daily Reckoning