Anybody on this site who is directly involved in the credit markets will confirm that things are far worse than the average person knows. Being in the middle of it, all I can say is that we are in an unprecedented financial vortex. All asset classes are getting hammered, with the exception of treasuries, precious metals, the dollar and yen. My advice to family and friends as individual investors has been this - now is the time to insure a return OF your principal, not a return ON your principal. For traders, great opportunities abound in all of this volatility. But as citizens, the long term consequences of what is currently happening will be profoundly negative for quite some time. We are in for a period of pain that has been a long time in coming.
And who do we thank???? PS. Great post. There are people in serious pain who have done nothing wrong.
Find someone everyday to help in some small way. We as traders can make money in up or down markets. What a great business to be in.
I'm on the buy side also but not quite ready to pull the trigger. Ideally, I would like to see lower valuations and then I'll step in on the way back up around these levels.
Ursa Major coming to the helm. 50% may be the bottom. There is going to be zero "SNAP" back like many are talking about. Just isn't gona happen. Chance of a Depression, well look at Royal Bank of Scotland. They released a report over 5 months ago. I suggest you read it. Things are not "normal" nor have they really come to head yet. Panic has yet to set in. There is a Reason FDIC is now 250k for limit. Panic comes when the Run on the banks for Joe Sixpack happens. Who knows when that will be
American financier kills his family and himself after losing fortune in credit crunch http://www.dailymail.co.uk/news/wor...ills-family-losing-fortune-credit-crunch.html
I agree, the major unknown that has me concerned is the derivitaves market, specifically CDS (Credit Default Swaps) which I believe has not truly unwound yet. This market is $60-70trillion dollars. Where are we with regards to CDS are we halfway through the unwinding, or god forbid has the unwiding not begun. Overall though, with the currency collapse that we can expect in the 24 months, I see certain stocks an opportunity as you definetly dont want to be in $USD
The unlucky officials in charge of overseeing this bailout are quickly learning that you can't pull one strand in a spider web and not move the whole web - each yank has repurcussions. And the derivatives market is one seriously opaque, off-balance sheet piece woven right into the web that has been allowed to balloon in size and complexity, and completely unregulated without a centralized clearing house. The general public is hearing about "counter-party risk" for the first time in their lives....when the financial industry knew the entire game was a ticking timebomb. I agree with a previous poster...we have not seen panic at the individual level yet. A friend of mine was saying "hey, I'm thinking Google is a good buy here", others have not mentioned selling a single fund or share, and I still hear people saying "this is a good time to buy". These are boomers and younger people. On the flip side, I have heard reports of seniors who have been around the "life block" many a time are pulling large amounts of cash out of their checking and savings accounts (like $50,000 and up) - and that's with the $250,000 FDIC backing. Panic...not yet. Let's just hope it doesn't come to a "bank holiday".
just wanted to update. I've been talking with people who have been setting aside emergency cash just in case a bank holiday or freeze hits. One friend wen to withdraw a nominal amount under 40K from small region bank in Florida. To spread around to other accounts and assets He said it was an hour long process, bank manager got involved they did everything they could to keep the money in the bank. he wasn't even closing the account just taking some cash. They acted as if he was committing a crime or punishing the bank He says he felt more panicked after he left then when he got there.
The irony of it all - banks don't like it when you take large amount of cash out exactly when you need it/want it the most - especially since they don't have very much actual cash sitting in the vaults every day. And the fact that he was more worried when he left is telling.