Check Out Chris Whalen’s Terrifying Presentation On The 2011 Foreclosure Crisis
Oct. 7, 2010
Chris Whalen has doubled his warning about the coming banking bloodbath.
At a Thursday conference with Nouriel Roubini, Institutional Risk Analytics’ Whalen said the foreclosure crisis would make 2008 look like a cakewalk (via Prag Cap):
The U.S. banking industry is entering a new period of crisis where operating costs are rising dramatically due to foreclosures and defaults. We are less than ¼ of the way through the foreclosure process. Laurie Goodman of Amherst Securities predicts that 1 in 5 mortgages could go into foreclosure without radical action.
The recent suspension of foreclosure filings is just the beginning, Whalen says.
The largest U.S. banks remain insolvent and must continue to shrink. Failure by the Obama Administration to restructure the largest banks during 2007‐2009 period only means that this process is going to occur over next three to five years –whether we like it or not.
The issue is recognizing existing losses ‐‐ not if a loss occurred. Impending operational collapse of some of the largest U.S. banks will serve as the catalyst for re‐creation of RFC‐type liquidation vehicle(s) to handle the operational task of finally deflating the subprime bubble.