From The Cutting Edge:
...Next Shoes to Drop—How High Will the Losses Go?
Banks and security firms have reported $468 billion of losses thus far. Bridgewater Associates, a well respected analytical firm, believes things will get much worse.
According to Bridgewater, the models used have grossly underestimated the actual losses. They doubt the financial institutions will be able to generate enough capital to cover the losses. According to the report: "Lenders would have to curtail loans by roughly 10-to-one to preserve their capital ratios. This would imply a further contraction of credit by up to $12 trillion worldwide unless banks could raise fresh capital."...
James Quinn is Senior Director of Strategic Planning, The Wharton School, University of Pennsylvania. This article reflects the personal views of Jim Quinn. It does not necessarily represent the views of his employer, and is not sponsored or endorsed by them.