From subprime to bailout, 2008 year in review
Who would have thought when HSBC (Hong Kong and Shanghai Banking Company), the third largest bank in the world, announced in early February 2007 that they were setting aside additional reserves to cover bad debt (from subprime loans) expected to be 20% higher than forecast that by the middle to end of 2008, we would witness the US government stepping in to avoid a financial meltdown with arranged marriages of previously venerable but failed financial institutions and engineering a massive bailout.
And even though I wrote this on February 16, 2007, little did I imagine the scope of the bailout.
I would expect some kind of hit to the financial system. Of course, if that would occur, the US Government would likely step in and help out, in plain English or American, such as it is, that means the taxpayers will bail out the losers.
Here's hoping that the serious problems facing the economy get resolved and that better times begin in 2009.