Wednesday, Nov 21, 2007
Meltdown Coming
FT: standby for generalised systemic financial meltdown
“Gold is for optimists. I’m diversifying into canned goods.” Yes this guy really sees things heading over a cliff.
Posted by happyrenterz @ 10:10 AM (797 views) Add Comment
7 Comments
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1. Rentinginthesouth said...
bet his tin-opener is made of gold though..
2. handle_it said...
Just in case anyone doesn't know what a "siv" is (like I didn't):
http://en.wikipedia.org/wiki/Structured_investment_vehicle
I must confess some of what that guy says I don't fully understand but I'm going to start burying food parcels this evening....
3. shipbuilder said...
I can do better than this guy - i'm hoping for a full-scale restructure of our monetary and economic systems. If financial meltdown means runs on banks and rioting in the streets, leading to nationalisation and restucture of banking (for example), I can't see how anyone couldn't agree that we'd be better off in the long term.
4. Tangara said...
"Gold is for optimists. I’m diversifying into canned goods"
==> S2R1 has found his grand-master on this one :)
S2R1 : any comments ? still buying gold ? :) :)
5. Johnno said...
"SIV", more like "SPIV" !
It does look like the chickens really are coming home to roost. I remember well the late 80's/early 90's. Back then at least you knew it couldn't get much worse than 15%+ interest rates. Now, there is only one way for the rates to go; probably "official" inflation too once they can't fiddle it any more. Bizarre at it seems canned goods might not be a bad idea ...
6. magnifico said...
Shipbuilder, what a great let off that would be for the irresponsible gamblers who got us in this mess. Myself I'd like to see greed punished
7. Lukeskywalker said...
I'm hoping that they'll scrap the stock market and bring in a system that reflects the reality of company performance and not this current game of a stock price that reflects the aggregation of masses of people second-guessing what everyone else might be thinking.
Of course, proponents of the Efficient Market Hypothesis would say that over time its reflective of the prospects for a company, and that over time, movements in-between are random and that you can't outperform the market. So if information is always reflected in the price over time and you can't outperform it, then the system that promotes speculation should be wiped out in favour of one that only reflects the current reality. Over time, it would also reflect all information (because its based on it) but without all the hysterical movements in-between. I mean, you wouldn't design a car with a steering rack that was erratic but on average you were in the right lane!
Someone once said, "Investing is simple, but not easy." - that's because the simple concept of researching a company and investing is made nigh on impossible to execute because of a flawed system.
"Fear and greed rules the stock market." Right. So not a collective state of corporate results.
So hold your stocks longer, but John Maynard Keynes reminds us all that "Markets can remain irrational longer than you can remain solvent."
No wonder people put all their money in bricks and mortar, but now its becoming a market-place just like the one Mr Maynard Keynes is talking about.