Wednesday, September 17, 2008
On The Precipice
In my recent post "If you ain't scared" I laid out how close we were to a Financial Meltdown. A couple of times between here and there I thought that it would be bad, but we would avoid Armageddon. Whoops! It sure LOOKS like Armageddon.
Citigroup, Goldman Sachs, and Morgan Stanley do not appear to me to be able to survive the defaults on all of the loans on their books. What was so hard to understand? When people default on over $1 Trillion in mortgages someone else has to take the hit. Those "someones" were the banks, bond insurers and brokerages.
This is why you can't have all your eggs in one basket. If you have the means, you should own a farm or rentable farmland, precious metals in the form of bullion, cash, energy equities, a small business that produces something for local consumption, etc...
The energy crisis has not even hit the market in force - yet. What will things look like when that inevitable event comes to pass? Still believe in miracles? Where is the capital required to invest in "alternative" energy going to come from now? The banks? HAHAHAHAHAHAHAHA! Get a GRIP!! And get a bike.
Mentatt (at) yahoo (d0t) com
Posted by The Short Story Man at 10:16 AM