And I’m back…and the investment world is still nutty

inoculatedinvestor's picture

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Anonymous's picture

Michael Jackson's ranch was called "Neverland" not "Wonderland".

Gimp's picture

Looking at the S&P just about all the equities are at or near a 52 week high....this is logically unsustainable. Expect in January the sell off will begin as the hedge fund managers will have the names on their lists to impress clients by Dec 31st and won't want to hold them for the next six months.

Anonymous's picture

Oahu is an island too, has people from all over the globe buying property providing a floor under prices, and I'm not even going to mention what the weather is today. People are very much still in the denial stage but listings have dried up, agents are whining about low ball offers, and that supposed floor is falling all the time.

I'm not sure that a man made island or underwater hotel is any more ridiculous than a $600K house in Compton.

Grand Supercycle's picture

"The US dollar carry trade: This is a topic that seems to illicit a lot of disagreement. Nouriel Roubini is sounding the alarm about how devastating an unwind of the carry trade could end up being."

The dollar rally I forecast is showing increased strength.

I am still expecting a substantial rally.

Anonymous's picture

How 'bout our laughable GDP? The squid itself expects
a decline in US GDP from 3%-1% by the 4th quarter of
2010, but don't worry, they're going to run up the markets
for everyone in the first half and bail in the second.
That's EVERYONE'S plan!!!! All on 2% GDP!!!!
Bwahahaahahahaha. Where do I get in line?

Anonymous's picture

Screw it....let's just buy stocks! Everything's just

Careless Whisper's picture

Ghee, ya think Manhattan is still bizarro expensive? Hey you out-of towners take a guess what $150,000 buys you. 10 x 15. That's not the size of the closet in the master bedroom, it's the size of the en.tire.apart.ment. Must be a top location right? Hehe. Let's just say you're a subway stop away from the boogey-down Bronx. So a 30 minute commute from Westchester or Jersey doesn't seem so bad after all.

The path back to the mean could be filled with danger.


Anonymous's picture

Hit "CTRL" and the Plus (+) sign to enlarge fonts or (-) to decrese fonts in a browser

SWRichmond's picture

But, how do we know that the percentage  increase in the balance sheet has not put the Fed in the position that it cannot possibly reduced its asset holdings fast enough of efficiently enough to prevent inflation?

This seems to be the question that everyone is concentrating on, but I think it's a red herring.  The speed of the Fed's actions are not the question, nor is their timing.  It is their ability to actually undertake them that is the relevant question.  What happens when they do?

  • Tax revenues collapse
  • Demand for social services explodes
  • Government borrowing costs explode
  • States and municipalities go bankrupt, increasing demand for social services

The debt burden is overwhelming; we can grow and produce our way out of it (HAH!), we can print our way out of it (default), or we can outright default.  Are there any other choices?  Printing destroys the currency, default destroys the currency.

Psquared's picture

I don't know if Obama believes it or he is trying desperately to convince himself, but he seems to be of the opinion that deficits simply do not matter.

He will have to do some fancy footwork over the next 3 years to be re-elected. My crystal ball tells me that the world will look quite different in 2012.

Anonymous's picture

Why are 6% returns not attractive? Oh yea, that's right, a 10% annual return is a fundamental human right and Jesus said so. Silly me.

Anonymous's picture

It's my understanding that the Fed is not letting banks lend out their reserves at the Fed. The plan is to give the garbage back to banks. The banks don't want what is on the Feds balance sheet. The reverse and Tri-Party repos are not working. Allowing the banks to lend out their reserves will bring hyper inflation. The 0.25 interest on reserves at the Fed isn't enough to really help the banks. Option-Arms, CMBS is the next leg down and it's dead ahead!

Psquared's picture

So all of this depends upon restructuring at FRE and FNM and the stabilization of the real estate market. (prices)

Either that or banks will have to be permitted to lever up to 500:1.

Leo Kolivakis's picture

Is it possible to increase the size of your fonts? Thanking you in advance.

bbbilly1326's picture

I use ctrl+mousewheel successfully.

SWRichmond's picture


Us old guys that can't freaking see anymore have already figured that one out.  In firefox: Tools - Options - Content tab - fonts/Advanced.  Pick a font and size, and uncheck "allow pages to choose their own fonts".

Anonymous's picture

"just about everyone failed to foresee the financial crisis,..." Except that I was reading warnings about it in 2005 by multiple economist and analysts. Some had been warning about it in 2000. Failed to foresee? It was obvious to anyone who wanted to seriously evaluate the situation. It seems as though Hank Paulsen was the only one who had no idea. Oh yeah, Right!

huntergvl's picture

Aren't you just sick of seeing that one foresaw the financial crisis.....

I may be just a one man band managing my own money, but it was so obvious to me that the system was over leveraged and absolutely had to collapse. Any one with half a brain that first heard the phrase derivative exposure, and learned about the MBSs, CDOs, CDSs, including many more exotic securitizations and didn't take steps to preserve capital and prepare for the inevitable collapse should not be managing money and certainly should not be giving opinions about anything having to do with investing. If you missed that, you just don't have what it takes. Period!

whwood75's picture

To elicit means 'to draw out' or 'to obtain' (usually information). Illicit means 'illegal'. Otherwise, good and provocative observations.

Psquared's picture

Yeah, that is won the spellchecker will miss. ;-)