Monday, March 17, 2008

low-pressure trough

Bear-Stearns price graph.

A low-pressure trough is sometimes called a depression. I have been talking of an impending depression for years (not here, but elsewhere, and verbally). Most people just thought that I was a crank, but it is starting to come to fruition.

Bear-Stearns was trading at around $70/share last week, but today, sold off the whole shebang for $2/unit. I'm sure that a lot of people thought that BS was different. Bear-Stearns is just one banking house in trouble, there are more to come - by all accounts.

I know that a high CDN dollar is problematic for exports to the US, but our dollar slipped below par today. That is bad news for us. We do not want to follow the US to the bottom, but it appears that we will. All those fools that bought RE at exorbitant prices in the last few years are going to be in big trouble when the carbon tax comes in, property taxes sky-rocket to pay for the Olympic scam, TransLink is putting in a new tax, Hydro rates to increase some 25%, job losses coming soon, etc.

Here is an interesting article at proclaiming that Black Friday is back. The article is a bit long to keep one's attention, and is kind of spectacular in writing style - it is also aimed more at the US reader, but there is some stuff of interest about halfway through.
There is one more player in this quagmire of failure and defeat that has yet to show its face. That is the face of those that have supported all this criminality and horror with their greed and with their interminable silence throughout this most treacherous chapter in all of American history.

These are the would-be emulators of those in power, regardless of how corrupt or jaded the individual criminal-figures might actually be. These are vulture capitalists in-waiting, not yet fully fledged, but still very eager to find a way to get their own piece of the corpse that was the USA. They are the reason that so many have remained silent and complicit with all that has transpired. In reality these seemingly ordinary people, have made it possible for the owners to get this far without a violent public backlash.

Now while the real players have begun to pull their money out of everything, it is these small-time opportunists who will be left with nothing, because they weren't smart enough to get out before the major dominoes began to fall. Now they, along with us, will be left holding the bag and screaming about "what could have been!" Because whenever any major 'bubble' bursts, the key players not only escape, but they always have made huge new fortunes from each new chaos-while the suckers lose it all.

This time there are literally millions of suckers that did not study the Stock-Market Crash of 1929, so they've just been waiting in the wings to be crushed by this burden: which was always part of this design that was created to insure that this failure will be total!

The lesser beings that sought to profit..."believed implicitly" that they would end up on the winning side with their own smart-money profits as a bonus. But re-born Robber-Barons do not suffer fools or casual opportunists-instead they eat these 'hangers-on' that would have cluttered up their kill. So, once again only the few will profit, while all the rest of us will pay because 'the run on the banks' has begun and the Fed can't print money fast enough to stop this, if it reaches beyond the business class and into the general population. (emboldening and clipping mine)

I think that Rense may be a bit sensationalistic - like Alex Jones, but still speaks to the truth.

Things are going to get nasty. Forget schadenfreude, we are all going to hurt. Get rid of debt, and stash some cash while you can.


Will said...

Stash your cash? Didn't you just fret over the possibility of an at-par or worse CDN dollar following the US down to the gates of Hell? You're not alone. I see contradictions on other fear-stricken blogs all the time. They have their own panic and are looking for what will become the safe harbour. If not real estate, then gold? or oil? or beanie babies and baseball cards?
Seems to me that the answer is to go debt free and invest your money in others who are also debt averse (not debtphobic, just demonstrated conservatives with debt).

solipsist said...

Didn't you just fret...?

No, I just pointed something out.

I don't see this as a "fear-stricken" blog - usually I am just observing, and making snarky comments. I certainly fear little (not even spooks!).

I have stated many times that my safe harbour is the bank - and it's paltry interest rates.

If I had a mortgage, I would be stashing away as much cash as I could - just in case I lost my job. To me that is prudence, to others, it may be fear. Inflation may eat away at savings, but that payment will stay the same, and in Canadian dollars.

The thing about depressions is that there is no momey when they are on. The more you have, the better you will weather it.

Seems to me that the answer is to go debt free and invest your money in others...

You pretty much re-iterated my point. I would be interested to know whom is debt-averse. I know a very small handful of people that are such.

solipsist said...

D'oh! I can be so reactionary...

I see that you (will) wrote other fear-stricken blogs, and in my pompous pedantry, I read it as written (I would have written - other, fear-stricken...).

The typed word is hard to grasp the nuance of, I guess.

I was wondering, because usually, you (will) are non-confrontational, and fairly demure.

Please don't be reluctant to post, and let us not get into grammatical exactitudes, and such. Grin!

Will said...

No sweat, Sol (Can I call you Sol?) :)
There are several cash cow low debt investments in my portfolio (a lesson learned from the dotcom days... were we ever so young?) Seek and ye shall find (yes, mostly resource based, oil and gas, mineral, leasehold trust types and transport of said raw materials).

solipsist said...

will - call me what you will (grin).

Since the dotclusterfreak, I am into strictly Venture Capital. High risk-meagre gain, but I drive a Mazda mini-van... That's all just "play money" though. With my larger capital, I am very conservative and risk-averse - hence the paltry bank interest route.

I have CDIC concerns. It is said that we (NA) have trillions in savings accounts, and I question the ability of those Crown and gov't (FDIC) Corps to resolve the loss of those funds. It is possible for governments to bankrupt.

I don't mean to be doom and gloom, but I have always fared well by entertaining the "worst-case scenario". I keep thinking of the scramble for bio-fuels and hog feed driving up the cost of bread and tortillas, and think of the Weimar Republic circa 1933.

Anonymous said...

Rumor has it that MF filed for Bankruptcy protection yesterday. Still havn't seen anything in the news about this. They're down somthing like 80% when I checked yesterday. Look out below.

solipsist said...

Rumor has it that MF filed for Bankruptcy protection yesterday.

MF being Massey-Ferguson?

M- said...

MF Global, I would assume, though I know nothing about their situation...

solipsist said...

Thanks m-

Still being wet behind the ears, I had never heard of them. You can still open an account on their web site.

Patiently Waiting said...

Sigh, we just received a new menu from our favourite Thai restaurant. Most items increased by a dollar. It cost 10% more for our regular order. I also noticed they were stingy with the Prawns.

Yep, glad to be debt-free. It will make all the inflation easier to bear.

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