WHAT THE HELL IS GOING ON ?
A $700 Billion bailout FAILS and a co-ordinated global rate cut FAILS, so I guess they are working overtime on a new plan.
In the meantime, nothing has really changed -
President Bush says the economy is innovative, industrious and resillient!
The Credit Market is frozen, and the LIBOR just won't come down.
Billions and now possibly trillions of USD, and no liquidity injecting measures are working yet.
The G7 will 'take necessary steps' and has been calling for'urgent and exceptional action'
The declines in stock markets have been incredible! Whats been really surprising and rather worrying, is that there has been no dead cat bounce yet!
CATCHING FALLING KNIVES:
In the coming weeks, if total panic sets in, even conservative and unleveraged firms could fail or at least see their stock values crash if things don't stabilise soon. Be careful while bottom fishing in equities, and although you may have a long term investment horizon; focus on your risk profile and your necessary 'margin of safety' before you buy in.
My call would be for the onset of deflation, and as prices of overvalued and leveraged assets fall, the Central Banks will continue to flood the system with liquidity, and bailouts for all the PIRATES OF WALLSTREET.
As poor quarterly results and upcoming layoffs add to the woes of Wall Street in the coming weeks , the bailouts are going to get larger and larger.
Ultimately this will destroy the currencies of all participating Central Banks, and we could be in for a dose of hyperinflation as a result.
My next post will focus on charts of crashing stock indices, currency graphs, and Gold prices