The Risks are Now So Huge that Market Psychology is the Key
This Would be a Rather Bad Time for a Skeleton to Fall out of a Banking Cupboard
We have previously argued that the world's financial system was becoming systemically unstable. As events unfold, many of these concerns are now being borne out. The risks are now so huge that government money on its own cannot necessarily resolve them by brute force - the real key is to manage, and even take advantage of, the psychology of the market. One of the key factors that will determine whether this is practically possible, is whether any of the banks have any gruesome skeletons that will fall out of a cupboard at a particularly inconvenient moment.