Ernst Stavro Bloviator, Senior Fellow at the IER, issued the following statement:
The CRASH-CON rating is now moved to CC-1, and will not be moved back until significant improvement in the financial health of the US economy is apparent. Markets may rally on government intervention, but they are still fundamentally unhealthy and the extreme risk is on the downside.
Last week, Bear Stearns Inc. collapsed in one of the most breathtaking waterfalls in the history of the stockmarket. The other investment banks, mortgagae banks, home builders, and insurance companies will soon follow.
They are in the same business and all built their business on the same, stupid lie: REAL ESTATE ALWAYS GOES UP.
For 26 years, the US economy has been based upon the build-out of the Finance, Insurance, Real Estate and Tech industries. All of these will be a shadow of their former selves, and unemployment will skyrocket north of 25%. Home prices will crash to 20% of its peak value, and governments will be starved for tax revenue.
Expect extreme volitility with a sharp downward bias on everything that is related to finance, insurance, real estate, and tech.
Bear Stearns is not the only grenade rolling around on the floor. Remember, as of Wednesday, their CEO said that all the rumors circulating about the financial health of Bear Stearns were untrue.
How many other CEOs are saying the same thing?
Bear Stearns stock lost 97% of its value in just over two weeks.
The dream is over. The alarm clock is ringing. Reality is brewing. The morning headlines are in 200 font.
5 comments:
But you still do not know where is Mr. Snake Pliskin? The only guy who can save us! :)
"The dream is over. The alarm clock is ringing. Reality is brewing. The morning headlines are in 200 font."
That was 3/16. This is 5/1. Is it time for breakfast yet?
What's my name
Check the FED's balance sheet and get back to me.
"Check the FED's balance sheet and get back to me."
I thought the collapse of our economy wouldn't require so much research. I thought that I would feel the impact personally.... I mean in ways other than reduced interest cost on my credit line.
whats my name
Interesting news something I did not know.
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