Black Monday...

[Person Man]

It's ok. The Obama fanatics are still attacking Palin to satisfy their unusual hatred for the woman. Sounds good to me though.

It's okay. I've decided that there is nothing I can gain from being angry from all of these attacks, so I will learn to forgive Phil.

[Person Man]

I wonder what will happen today. Europe went down as well now, though not as bad. And it looks like Goldman Sachs is in trouble as well.

After a morning sell-off, basically filling yesterdays orders and responding to changes overseas after market hours, I expect the market to stabalize and close over 11K.  A 500 point drop is an overreaction, and that typically leads to a correction the following day (assuming no surprises pop-up during trading hours).  With oil prices continuing to fall, there is enough of a positive lift to balance out any minor negative pressure.

Yes, but will it be enough to get the markets back to where they were before it becomes time to sell again. Then again, it is time to buy.

[Person Man]

Well, they can conceal the damage as much as they want, but they will still be losing money pretty badly. Then again, banks are less likely to fail. ...but if they still fail despite the plan, it will be a pretty crushing loss.

[Person Man]

In a month, this will be a blip.

That will probably depend on if this multi-bank stability plan that the banks are currently working on (pooling resources together to loan to struggling banks and/or buy some of their liabilities) works or not.  I think it is a smart business plan by the collective to stabalize their own sector.  However, you are going to see a hit on the insurance companies as they start paying out for all the damages in the gulf, though the individuals and companies that receive their payments will stimulate the home construction companies and local realty markets by buying homes that have been sitting in foreclosure (rather than rebuilding).

Some of that, where the damages were the largest, will be flooding and covered (if at all) by the Feds.

You might see some takeovers of banks with my [sarcasm]favorite[/sarcasm] bank, Sovereign being the most prominent.  That will be the last of the "subprime shakeout."  The one thing you will see is the concentration of greater assets in fewer firms.

Obama's speaking about it now, and it could backfire.

...and then the entire issue of competition comes up. Gee...talking economics is fun. To tell you the truth, I am not really worried about this as much as we are being greased up for the global cooldown. We will simply not have the banking capitol to provide enough loans for businesses to retool the new conditions of a China growning at 1 or 2% per annum, instead of 9 or 10% per annum. Then again, maybe the market will be too cold to react too violently to any sudden changes. 

[Person Man]

In a month, this will be a blip.

That will probably depend on if this multi-bank stability plan that the banks are currently working on (pooling resources together to loan to struggling banks and/or buy some of their liabilities) works or not.  I think it is a smart business plan by the collective to stabalize their own sector.  However, you are going to see a hit on the insurance companies as they start paying out for all the damages in the gulf, though the individuals and companies that receive their payments will stimulate the home construction companies and local realty markets by buying homes that have been sitting in foreclosure (rather than rebuilding).

Some of that, where the damages were the largest, will be flooding and covered (if at all) by the Feds.

You might see some takeovers of banks with my [sarcasm]favorite[/sarcasm] bank, Sovereign being the most prominent.  That will be the last of the "subprime shakeout."  The one thing you will see is the concentration of greater assets in fewer firms.

Obama's speaking about it now, and it could backfire.

...and then the entire issue of competition comes up. Gee...talking economics is fun. To tell you the truth, I am not really worried about this as much as we are being greased up for the global cooldown. We will simply not have the banking capitol to provide enough loans for businesses to retool the new conditions of a China growning at 1 or 2% per annum, instead of 9 or 10% per annum. Then again, maybe the market will be too cold to react too violently to any sudden changes. 

The market takes care of that.  I think we do sufficient capital.

Hopefully, the collapse of the oil market will facilitate that....but OPEC seems more willing to cut production, then again, if OPEC breaks up on production disagreements, the price of oil could collapse and that could save the economy...for a while...at least. The problem at this point really isn't capital as it is credit. People will need credit to survive the global cooldown. The Housing Market will have to fully recover by 2010 for there to be sufficiently available credit.

[Person Man]

My friend, formerly of Bear Stearns (now JP Morgan) recommends you begin heavily investing in funds placed under your mattress.

Well that mutual fund has greatly outperformed the market during the Bush administration. However past performance does not mean future performance.

So, we COULD be fu cked...

[Person Man]

Cool! The Feds are showing signs that they may be willing to nationalize all bad loans...