“The core problem is that the smart people are realizing that the banking system is broken,” said Carl Weinberg, chief economist at High Frequency Economics. “Nobody knows who is holding the tainted assets, how much they have and how it affects their balance sheets. So nobody is willing to believe that anybody else isn’t insolvent, until it’s proven otherwise.”
“…the smart people are realizing that the banking system is broken,…” Okay, I’m NOT one of these…BUT I think the system is broke. It reminds me of the auto mechanic who, after examining a car up on the lift for 30 minutes, tells the owner, “It’s broke.”