If financial crash comes
Published: 09.09.11, 14:04 / Israel Business
Will the world’s financial markets crash this month, or in the coming half year, or miraculously not at all? An economic breakdown often has two basic characteristics. The first is a broad feeling that something is structurally wrong in the financial markets. The second is that no one can foresee how and when the crash will happen.
This analysis is easy to illustrate. The huge problems with the US subprime mortgages market were known long before the actual crash in September 2008. Yet no one foresaw that the crisis would be triggered through the bankruptcy of the Lehman Brothers investment bank.