There have been reports of "total" bank debt in the trillions !
There has been a tightening up of bank credibility from the government but I fully agree they are very exposed. This is from their exposure to foreign loans plus extensive exposure to the mortgage industry in Australia
It must be remembered that the melt down from the GFC was in part caused by the government (USA) in increasing the requirement of cash holdings and the alteration of how that was measured which brought the loan debacle in the USA to light
As to the likely fall in house prices I can only comment that "if it happened before it can happen again"
In the late 80s we had falls in some Melbourne suburbs of over 60% with some banks deciding that they could not foreclose as there was no buyers at the prices that they needed to clear their loans
Against this picture there is the god given right of the BIG 4 to just do what they want with the knowledge that the government cannot afford the banks to fail/fall as that would signify the end to their government as well and probably a depression rather than a recession
If the above is going to come true the banks should accept a dramatic fall in their share price by getting on with the job of improving their (the banks) economic position for the sake of their country
