Anybody remember the thread when Rogers said that C was a buy @ $5 and the majority on the thread said he was an idiot and we would never see it in our lifetime. Remember in Market Wizards when he said in the late 1980's that Japan was going to go into a deep recession, remember when he called the decline in the USD the bull market in commodities and the bull market in China. Sure he is wrong sometimes but we have to remember that he didn't make his money from selling books, he made them from being an analyst, and a good at that. Maybe he is wrong on this one, but to rip on him like some are doing on this thread is beyond moronic.
This is not the Great Depression. While the Crash was pre-mediated and induced (no conspiracy there!), the evaporation of post-29 credit was unnecessarily prolonged by the lack of expansionary reserve-ratio legislation. Everyone took their gold outta banks, credit was restrained, and the Guv did nothing for years! Todays system is different. We can go to 0% whenever we like! Ideally, we nullify CDS, withdraw support for Banks, they start going under, LIBOR goes to 15, and weak banks fail. Why end their? Not all Banks are dependant on LIBOR to finance their day-to-day operations. Only Banks geared to the Tits (read: many, but not all!) need LIBOR to finance their leveraged positions. Further, we've got the FED open window and PRIME rate is still retardedly low. Sound banks can go there, borrow at 1%, then relend to finance business credit lines and maintain commercial credit! Once the weak banks fail and the System Flushes its crap - takes 12 months, thereabouts - confidence is slowly restored and credit/mortgage/CDO markets unfreeze and start to catch a bid! Why? Because all the Dog Fuckers got flushed and only the Strong Survive. Hence, a restoration of confidence! The Great Depression was only Great because Credit was unnecessarily restrained, long after the initial crash. That was the result of "unwitting" Government policy, or so we're told! In the end, yes, Business slash jobs, employment skyrockets (thank God for UI!), home prices dump 30%, Banks fail, markets dump more, lots of small business fail. UGH. Painful. In the end, its a severe recession. But after 18 months or so, when prices normalize, the economy gets jacked for another Huge Bull Run. Where does the Capital come from to juice the next big move? Creative Destruction. For every long there is a short. The Smart Money - like Rogers - made a killing on all these over-leveaged Banks going under - Citi, Lehman, Goldman, Merrill etc etc. There's a short for every long! All that market cap from shitty companies is transferred into the pockets of Smart Money who then reinvest in Sounder Banks, Investment Banks and other viable Growth Industries! That reinvestment through share equity stimulates business investment, construction, workforce expansion. JOBS! Thats what Capital Mobility is all about. The alternative? 8 Trillion PLUS. The end nowhere in sight. And future growth opportunities pissed away in unending sideways markets for X YEARS.
of course they were. i also predicted (a couple of posts before) that you were an ass and got it right. as the thread unfolded, you revealed yourself as so. this doesn't make me a genius though, just a lucky bastard. i am being sarcastic btw.
That is the strange point.. Where are the winners in the CDS world? It seems like we only hear of the losers. And if it was hedge funds, it sure doesn't show in their performance. Same goes with pension funds, etc. Besides the hedge winners, there must levered winners as well. The whole thing makes you wonder... The answer is there will be a lot more money supply in the end... Unless it was the fed and treasury who were the other side of the bets. Now they are just giving it back. Redo. (heheh ya right)
LOL. Rogers gets people fired up. Did some people here get caught in the tech bubble and missed the huge commodity run? Sour grapes. Here on ET? Nah. Probably just because he's a super intelligent Master of the Universe. Rogers started investing in commodities and telling people about them in the late 90's (look it up on Bloomberg) when most people were buying tech stocks at the top. Rogers started shorting financials and THE INVESTMENT BANKS and telling people about it well before the crash (also on Bloomie). Too bad he didn't explain EXACTLY WHAT the IB's were doing. Maybe it could have been stopped before it morphed into a melt down. Buffet also mentioned this derivative/IB problem in general, but didn't explain exactly what was happening either. You know he knew EXACTLY what the IBs were doing. It's mildly annoying that nether explained it so the boob tube watchers could get it.
Some small hedge funds have come out as huge winners, but you know there are bigger ones out there. Not the usual suspects tho. Maybe some nefarious offshore pools? I've got my suspicions.