Daily Truth Pills

Hosea 4:6 My people are destroyed for lack of knowledge…

So You Think 2008 Was Bad?

Posted by truthpills on 2009/02/05

Eric Sprott and Sasha Solunac
Sprott Asset Management
written January 2009
Posted Feb 4, 2009

By all accounts thus far, it’s already been a pretty bad year… and we’re only three weeks into it! If you will recall, 2008 was a pretty bad year for the banking sector. For example, the shares of Citigroup, Bank of America, and the Royal Bank of Scotland fell 77%, 66%, and 92%, respectively, in 2008. So far this year (remember, this is only three weeks) the same stocks are already down 50%, 55%, and 74%, respectively. Like we said, 2009 has already been a pretty bad year! For as bad as 2008 was, 2009 promises to be a whole lot worse. The problem isn’t just the banking system anymore. The problem is the banking system and everything else. This year, the financial crisis of yesteryear is morphing into an altogether different animal. It’s morphing into a financial crisis that has an economic crisis layered on top of it. In fact, to call the current environment an economic crisis is likely understating the situation. What we really have is a global economic catastrophe. One where weakness only begets more weakness, causing a vicious circle that is proving nigh impossible to reverse in spite of all the world’s financial, economic, and political brain trust throwing everything they have, including the kitchen sink, at the problem.

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