Look, when I said Fannie & Freddie were gonna fail... I didn't mean by next friday! Yes, the government will bail them out, and no, the bailout won't work.
The Braintrust, our own Dr. Lalani called me today and said if Lehman Brothers goes any lower, they are going to have to change their name to Lehman Brother, the other Brother will need to be let go...
Lehman does not survive this, and if they are smart, they will realize that there is room for ONE MORE Bear Stearns-like forced merger. The next institution (or 2, or even 3) will just have to fail.
GM & Ford, Fannie & Freddie, Bear & Lehman, American & United Airlines, wanna know who is next? What about Fedex and UPS?
A short covering rally is over due, and the Mad Scientist says that Gold is showing us that liquidity is being pumped into the system again. That liquidity is going to go somewhere, and is going to continue to sink the U.S.$.
Good Luck!
Mentatt (at) yahoo (d0t) com
The blood letting will continue.
Subscribe to:
Post Comments (Atom)
5 comments:
Methinks poor Fido has been violated.
The disappearance of companies is a phenomenon as old as capitalism itself ("creative destruction"). Take a look at the stock market 50 or 100 years ago. The overwhelming majority of the companies traded on the stock exchange at that time disappeared quietly. The names of these companies sound like ghosts today.
The ultimate reason for the disappearance of companies is that companies in general do not create capital, they in fact use up or destroy capital. GM is a typical example. A hypothetical shareholder of GM who bought in the early 1950's and kept holding during the past 55 years has lost a lot of capital. The true beneficiaries of the GM capital where the employees and the customers of GM. Now that the GM exhausted its capital bankruptcy is the only option left.
The most fascinating aspects of the US capitalism is its ability to recover from seemingly hopeless situations. Already J.P. Morgan said. if you short the US economy, you will lose.
Robert S.
I work for Fedex. My route is a remote area. I drive 300 miles per day on average. I spend as much as 100 dollars to fill my van per day. I've talk to couriers from the large markets where their giving LWOP's(leave without pay). Officialy Fedex has a no lay-off policy. But we will see what happens next year.
Robert:
The disappearance of companies happens sporadically over time. This is more like an Extinction Level Event, a ''Permian Die-Off" like period in which MANY large companies go down in short period of time, to my eye.
Companies in the aggregate cannot be net consumers of capital in a system primarily driven by financial assets. Governments and people can be net consumers, but not companies.
Post a Comment