Tuesday, June 5, 2012

The Global Minsky Moment Has Arrived

The "Minsky moment" refers to the work of Hyman Minsky, a deceased American economist who developed theories on how debt accumulation eventually leads to financial crises. You don't have to be an economist to understand the crux of Minsky's theories. As an economy grows it takes on increasing amounts of debt. The point eventually comes when the cost of servicing that debt can no longer be met by that economy's productive capacity - that's the Minsky Moment, and we're watching it play out all over the world today.

Read more: http://www.zerohedge.com/news/eric-sprott-real-banking-crisis-part-ii