The Telegraph UK has an extraordinary video Interview (and accompanying article) with British private equity banker John Moulton. He is amazingly frank and blunt about the current financial debacle.
It’s the worst crisis he’s seen in his “lengthy career.” The Fed will find out real soon now if refusing to prop up Lehman was a good idea. The LTCM bailout some years back was less than $4 billion. “That’s a rounding error in this stuff.”
Were the current problems fueled by greedy investment bankers? “That’s about 90% accurate, I’m afraid. People made a lot of money selling rusted heaps of cars called structured loans.”
Will the British government intervene? “Maybe, but I’m absolutely confident they haven’t got a clue either.”
“No one has experience with failure on this scale. No one.”