For the Record with James G. Rickards

The more enlightened practitioners understand that extreme events occur more frequently than their [risk] models predict....Events of any size are possible and are limited only by the scale of the system itself. Since we have scaled the [financial] system to unprecedented size, we should expect catastrophes of unprecedented size as well. We're in the middle of one such catastrophe, and complexity theory says it will get much worse.--former general counsel of Long Term Capital Management writing in The Washington Post


Crisis Update: The German government moved to rescue the failing Hypo Real Estate bank, a key operator in infrastructure lending and government financing, by providing 50 billion Euros of additional liquidity and announced it would insure German bank deposits up for up to 500 billion Euros. French bank BNP Paribas made a deal with the Belgium and Luxembourg governments to buy up the bank arm of failing Fortis financial group. Fear stalks global markets. Trading was suspended on bank shares in the Russian and Icelandic markets after indexes suffered steep declines. An indicator of the market turmoil is the volitility index (VIX), at a 19 year high. 60% of Americans polled for their opinion think another depression is on its way. The Dow Jones dropped 800 points today, but recovered to close down 369 points.