The missing USD 1trillion—IMF thinks it's gone..... Really?

As mentioned before, with $100 billion in depos, these days, banks create money to the size of $10 trillions (100 times; 10 times from money creation and a multiplier of another 10 times through loans' securitization).

Now, $1 trillion turns bad/rotten. $1 trillion will be needed to be put back into the banks. Though the house buyers had signed the papers, they hardly had paid for it and they merely declared themselves bankrupt. In US, houses have gone 'bad' or unlivable anymore as they were damaged so badly that it is better off to build from scratch. BBC reported that copper pipings and any items in these houses that are worth some money have been ripped off to be sold as scraps. In short, the supposedly created asset (or house) has been wiped out, becomes non-existent and now run down like ghost houses.

But don't forget, the $1 trillion loans that turned bad had already gone to somebody else's pockets, as the banks had already paid out that money.
20% to the contractors
20% to material suppliers
10% to lawyers
10% to salesmen
10% to land owners (who sold the land)
10% gone to the government in taxes
20% to the bankers and the CEOs' bonuses
(The percentages may differ among the parties but this does not matter. What matters is that the money has gone to somebodies' pockets)

Banks need to top up that $1 trillion by asking from investors. Who are they? Most of the above listed has spent the money to pay for workers' salaries, others are spent on oil, goods and services. At the end, who is holding the money? Middle East oil men has lots of it, China, India, Singapore and Japan have some of it, but not forgetting the US bankers, hedge fund managers (Soros earns 2.9 billions last year), lawyers, and salesmen have a hand in it too. They will put in some money, for example, GIC & Temasek put in about $30 billions or so. Others like Buffet, bankers, and Middle East Prince Alayweed …etc are supposedly buying in cheap now. But it won’t be enough. The god-fathers will have to print money at the later stage to top up, they are, the central banks and a rough guess, it will be about $300 billions. The $1 trillion top-up will be re-cycled to create more loans, which probably will be 20 times this time from its original value or $20 trillions to start with.

In short, with the $1 trillion "write-offs" which will be topped-up or recapitalised (banking term), the global economy will be flooded with $20 trillions (from the same process of money creation & securitization) in probably 3 years. There will be some assets creation, but others are in a form of more paper money (like the "banana" money kind with G. Washington face on it). The world is now growing doubtful of these green papers, so, the smarter ones have already parked their money in REAL assets, cold hard gold (not cash, unless you are holding the correct currency), copper,...but you can't really eat them when you need it. So, others would prefer soft commodities, soybean, pork, wheat...etc, since the middle class of Indians and Chinese, BRIC and other oil-based nations are demanding it. Of course, black oil is still one of the favourite until the nuclear power stations litter all over the world in 5 years' time. By then, probably starting 5 years from now, oil will start its decline.

So, in view of the extra $20 trillions flooding the market, “where to make the money” you may ask. ….to be cont.