How'd you know I was a monkey. What your advocating amounts to doubling down into a losing position. What kind of idiot advocates getting out of a leverage infused crisis with more leverage. The equity markets have run their course for the next 1 or 2 decades they will go nowhere but down to sideways as people learn yet again that there is no permanent bull market. The people they have trotted out like Boone Pickens and Warren B. to lend credence to the bail out stand to make billions. BP virtually said he's sure he can get support in Washington for his initiatives to stop his funds death spiral. Bluster and bravado are not playing anymore in today's world. Especially when the people telling you you have to take their loss stand to win by it. Will it tank the stock market maybe but I've been out for 2 years and will continue to stay short until we get to a reasonable level for the state the countries in. Much further down. I hope you lose your job, I hate to think your making decisions in any of the companies I'm going to invest in.:eek: JIM (The Monkey)
Here you go straight from another street monkey. By Jeffrey A. Miron Special to CNN Editor's note: Jeffrey A. Miron is senior lecturer in economics at Harvard University. A Libertarian, he was one of 166 academic economists who signed a letter to congressional leaders last week opposing the government bailout plan. Economist Jeffrey Miron says the bailout plan presented to Congress was the wrong solution to the crisis CAMBRIDGE, Massachusetts (CNN) -- Congress has balked at the Bush administration's proposed $700 billion bailout of Wall Street. Under this plan, the Treasury would have bought the "troubled assets" of financial institutions in an attempt to avoid economic meltdown. This bailout was a terrible idea. Here's why. The current mess would never have occurred in the absence of ill-conceived federal policies. The federal government chartered Fannie Mae in 1938 and Freddie Mac in 1970; these two mortgage lending institutions are at the center of the crisis. The government implicitly promised these institutions that it would make good on their debts, so Fannie and Freddie took on huge amounts of excessive risk. Worse, beginning in 1977 and even more in the 1990s and the early part of this century, Congress pushed mortgage lenders and Fannie/Freddie to expand subprime lending. The industry was happy to oblige, given the implicit promise of federal backing, and subprime lending soared. This subprime lending was more than a minor relaxation of existing credit guidelines. This lending was a wholesale abandonment of reasonable lending practices in which borrowers with poor credit characteristics got mortgages they were ill-equipped to handle. Once housing prices declined and economic conditions worsened, defaults and delinquencies soared, leaving the industry holding large amounts of severely depreciated mortgage assets. The fact that government bears such a huge responsibility for the current mess means any response should eliminate the conditions that created this situation in the first place, not attempt to fix bad government with more government. The obvious alternative to a bailout is letting troubled financial institutions declare bankruptcy. Bankruptcy means that shareholders typically get wiped out and the creditors own the company. Bankruptcy does not mean the company disappears; it is just owned by someone new (as has occurred with several airlines). Bankruptcy punishes those who took excessive risks while preserving those aspects of a businesses that remain profitable. In contrast, a bailout transfers enormous wealth from taxpayers to those who knowingly engaged in risky subprime lending. Thus, the bailout encourages companies to take large, imprudent risks and count on getting bailed out by government. This "moral hazard" generates enormous distortions in an economy's allocation of its financial resources. Thoughtful advocates of the bailout might concede this perspective, but they argue that a bailout is necessary to prevent economic collapse. According to this view, lenders are not making loans, even for worthy projects, because they cannot get capital. This view has a grain of truth; if the bailout does not occur, more bankruptcies are possible and credit conditions may worsen for a time. Talk of Armageddon, however, is ridiculous scare-mongering. If financial institutions cannot make productive loans, a profit opportunity exists for someone else. This might not happen instantly, but it will happen. Further, the current credit freeze is likely due to Wall Street's hope of a bailout; bankers will not sell their lousy assets for 20 cents on the dollar if the government might pay 30, 50, or 80 cents. The costs of the bailout, moreover, are almost certainly being understated. The administration's claim is that many mortgage assets are merely illiquid, not truly worthless, implying taxpayers will recoup much of their $700 billion. If these assets are worth something, however, private parties should want to buy them, and they would do so if the owners would accept fair market value. Far more likely is that current owners have brushed under the rug how little their assets are worth. The bailout has more problems. The final legislation will probably include numerous side conditions and special dealings that reward Washington lobbyists and their clients. Anticipation of the bailout will engender strategic behavior by Wall Street institutions as they shuffle their assets and position their balance sheets to maximize their take. The bailout will open the door to further federal meddling in financial markets. So what should the government do? Eliminate those policies that generated the current mess. This means, at a general level, abandoning the goal of home ownership independent of ability to pay. This means, in particular, getting rid of Fannie Mae and Freddie Mac, along with policies like the Community Reinvestment Act that pressure banks into subprime lending. The right view of the financial mess is that an enormous fraction of subprime lending should never have occurred in the first place. Someone has to pay for that. That someone should not be, and does not need to be, the U.S. taxpayer. The opinions expressed in this commentary are solely those of the writer.
There you go, you dill hole. You got your crap bailout. Tax payer on the hook for a trillion. Increased cap gains taxes in the future to pay for it, if they have any after this incredible loss of wealth after the bailout. At some point they will have to liquify assets at these lower levels just to make sure they can have heat for the couple years and take a huge loss. Pure stupidity. Pure stupidity! JIM
lol, nobody ever claimed this will bail out equity markets or corporates. It was and still is and will be intended to unfreeze short term money and libor linked markets. Nobody ever promised that this will mean an end to broad market valuations. So, dude, you should tame your temper, otherwise you sound like someone who lost a huge amount of money because he violated all his stop levels ;-)
as I explained many posts ago I cut my loss without much damage done. Not every bet works out but thats what stops are good for ;-) thanks for asking. But the sell off in all major currencies gave away splendid opportunities for those that closely followed the markets. In the end its a game of really letting profitable positions run while cutting losses as quick as possible. Of course never did I dream that usdjpy would sell of by almost 500 pips (caught only half of it which was more than enough). You?
you must confuse me with someone else I guess. I never criticized anyone for taking a shot at anything. If one takes a measured bet at going long or short why not. But please point me to the post in case I missed that.
No didn't lose anything Dill Hole. Except as a tax payer and disappointed member of the USA. Only losers go long into a down trending market. I've always contended this market was going lower no matter what. Credit will not be made normal at least the contemporary normal which is virtually free money. This whole situation and the response to the beginning of this financial crisis leads me to believe this will be one horrible time to be an American. I might as well try to get my dog to understand this, discussing it with you is much less effective. What company do you work for? I'm serious I would never be an investor there.