FROM EIR DAILY ALERT
Prins: Crash Coming Whether Central Banks Keep Pumping, or Stop
May 7, 2018 (EIRNS)—Continuing to speak on her new book, released May 1, Collu$ion: How Central Bankers Rigged the World, banking historian Nomi Prins made her most definitive argument May 6 for a coming general financial crash. In an interview May 6 with the Greg Hunter’s “USAWatchdog.com,” Prins said that central banks’ decade of uncontrolled money printing had built in a new financial blowout whether they now slow down and raise interest rates, or not.
Their false confidence that they have their own huge debt asset inflation “under control,” is no different from the identical confidence expressed by then Federal Reserve chair Ben Bernanke et al. at the peak of a speculative boom in 2007.
If the Federal Reserve and other major central banks turn back toward “normal,” non-bank bailout operations, “The markets would plummet really quickly,” Prins said.
But even if they keep pumping relentlessly,
“We will eventually get a crash because, at some point, the amount of quantitative easing, or conjured money to buy assets out of the market to pump up the ... financial system, will come to this head, where even though these major central banks are continuing to dump money in, ... there will be ruptures at the bottom of the economy. Even though they [companies and consumers] are borrowing cheap money, they just can’t make enough money to service even very cheap debt. Consumers, who are at all-time debt highs, don’t have enough to continue to service their debt.
“When these things happen at the same time in terms of lack of payments, delinquencies and defaults, then money will be taken out of the stock markets to plug the gap, and then the stock market comes down. It will start with debt disintegrating, defaulting or having delinquencies,”
the author explained.
“The behavior that happens after this is the seizure of credit and lack of confidence everywhere. When the cracks start, they will get bigger and bigger faster, and that’s when we have a crash,”
Prins concluded.
