BIS Forecasts for This Week a Debt Earthquake by Any Other Name

A new report by the Bank for International Settlements (BIS) dated Sept. 15, featured in the London Telegraph‘s Evans-Pritchard column Sept. 14, warns of an international debt blowout starting this week if the U.S. Federal Reserve raises its discount rate.

Ambrose Evans-Pritchard’s column is headlined, “U.S. Interest Rate Rise Could Trigger Global Debt Crisis.” It describes the warning from the BIS chief economist Claudio Borio, which directly echoes the warning last week by the World Bank’s chief economist, Kauschik Basu. So fears of Wall Street’s bankruptcy are coming from financial institutions at the highest level.

Seeking to warn of an immediate, global financial earthquake without using the word, the BIS’ Borio states in the report,

The BIS report shows total ratios of leverage debt to economic product are now significantly higher than they were just before the 2007-08 crash.

That central banks are “struggling to control events” is quite an understatement. Events are now controlling the central banks, including the Federal Reserve and Bank of Japan at their meetings this week. Commented EIR Founding Editor Lyndon LaRouche, “Wall Street is doomed to be shut down, soon. The collapse of Wall Street will be a terminal collapse of the whole system. We could deal with that, on President Franklin Roosevelt’s terms.”