A financial crisis may be coming - it won't be like last time (www.bbc.com)
from girlfreddy@lemmy.ca to world@lemmy.world on 29 Apr 07:01
https://lemmy.ca/post/64076055

In 2007, investments in risky US mortgages went sour as homeowners struggled to pay. Funds run by Bear Stearns, BNP Paribas and other banks either had to freeze the ability of investors to take out their money, or liquidate the funds completely.

These problems were the canaries in what proved to be a very deep financial coal mine. As nervousness spread, even banks eventually stopped lending to each other for fear of not getting their money back, creating a so-called “credit crunch”. That caused a global financial crisis.

Fast forward to today.

Several funds which lend money have declared losses or restricted investors’ ability to take out their money. BlackRock, Blackstone, Apollo and Blue Owl have all faced demands for billions of withdrawals from private credit funds - institutions that provide an alternative to traditional banks.

#world

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absquatulate@lemmy.world on 29 Apr 08:40 next collapse

Several funds which lend money have declared losses or restricted investors’ ability to take out their money. BlackRock, Blackstone, Apollo and Blue Owl have all faced demands for billions of withdrawals from private credit funds - institutions that provide an alternative to traditional banks

Those are some…interesting names. Could these be attempts to pull the rug before an AI crash? I’m genuinely asking as I have no clue how funds work

Buffalox@lemmy.world on 29 Apr 09:42 next collapse

It’s very obvious that we are very likely headed towards a global recession, driven by the problems Trump has created in the gulf.
Of course financial institutions are preparing for the eventuality, and that alone can cause a financial crash if it accelerates.

It’s extremely difficult to estimate the risk or chance, but the fact that (almost) everybody is aware, makes the risk bigger, because for some weird reason, everybody preparing for a financial crisis doesn’t make it less likely because people are prepared, but instead makes it more likely because nobody does anything when the uncertainty passes a certain threshold. And at that point the economy collapses.

gedaliyah@lemmy.world on 29 Apr 09:59 collapse

Yeah, Trump didn’t help, but I think it’s more to do with a decade of private equity dropping trillions of dollars into industries that never return any value.

ExLisper@lemmy.curiana.net on 29 Apr 10:47 next collapse

it won’t be like last time

It will be way smaller and the consequences will be milder, right?

peopleproblems@lemmy.world on 29 Apr 12:15 collapse

Its intentional. Don’t think for a second the powers that be couldn’t stop it.