Dear Wall Street: While I realize it is only September, my PR people thought it best for me to "Get out in front of this one," as certain expectations have been established over the years regarding my annual visit. Therefore, it is with great regret and a heavy heart that I issue the following statement: "I'm not coming this year."
Why? You’ve Been Naughty!
That's right, you heard me correctly - I'm taking the year off - so I've decided to write you a letter for a change, to tell you simply, "You’ve been bad for goodness sake (especially the banks and credit-rating agencies) and you're only getting worse!" With the help of Moody's and Standard & Poor's, there were $85 billion in mortgage securities downgraded in the third quarter of 2007, $237 billion in the fourth quarter, $739 billion in the first quarter of this year, and $841 billion in the second quarter of 2008! Not exactly "Jolly" is it?
Furthermore, since my last visit, I’ve hired a prestigious law firm with domain expertise in security, investments, and commodities to represent me, and for the past few months my new legal team (Locke, Stock, & Barrel) has reviewed my contract and found that there is in fact no so-called “Santa Clause” requiring me to visit each year, and with the slowing economy and rising costs I’m going to have to take a Rein-check for 2008.
To reduce overhead here at corporate headquarters, I tried laying off all of my seasonal workers, but then the elves unionized, demanding overtime and hardship pay for having to work through the holidays every year, and they’ve just filed multiple lawsuits citing height discrimination, exposure to lead-based paint used in toys, and claiming that some of the elves I hired are younger than 16. I recently had Rudolph’s nose switched over to a high-efficiency alternative (saves money, but I can’t see worth a halogen), and with the plummeting stock price of Kringle Enterprises, I was forced to add a Board seat for some activist investor yahoo who’s out to prove that, "Anything you can do, Icahn do better."
I Traded My Sleigh for a Scooter
With the cost of transportation hitting historic highs in July, I was forced to pawn my Sleigh for a Scooter. Featuring a tricked out manifold, reinforced shocks, and aftermarket afterburners, this “Santa Scooter” can really shoot the moon – but it doesn’t have any trunk space. Hence, with my Sleigh in hock, the only other option would be commercial air travel, but ticket prices have increased over 60% since last year – and do you have any idea how much it would cost me to check all of these bags of presents on Delta? Plus, by December, the airlines will have introduced a Fat Tax on all overweight passengers (to cover the extra fuel charges) and the “Obese Police” will force me to buy an extra seat and a seatbelt extender. Finally, with all of the cutbacks, there’s a good chance I would get bumped from my flight on Christmas Eve, and even if I screamed until I was Jet-Blue in the face, I wouldn’t get out of JFK until MLK Day. (I thought about using some of my Frequent Flyer miles to cover the cost, but for some reason Christmas Eve always falls on a blackout date). And speaking of black…
“Black Friday” Becomes “Red Friday”
There won’t be a “Black Friday” this year. Sure, there will still be huge discounts the day after Thanksgiving, but this year (in an effort to “Beat Wal-Mart”), the “Back to Christmas” sales will start shortly after Labor Day and “Black Friday” will be renamed “Red Friday” because the retailers will still be in the Red for the year, and most will stay there for the rest of the holiday season. But hey, Red is a Christmas color, so each time you see a Red stocking, think about a Red stock, and all the Red ink flowing from the balance sheets of the bad little girls and boys running the big financial firms that didn’t sock away money during the boom times for the inevitable bust to follow.
Red – It’s the New Black
And it’s not just my red nose - even The New York Times said the numbers were staggering: “Between early 2004 and mid-2007, a period of unprecedented wealth on Wall Street, seven of the nation’s largest financial companies earned a combined $254 billion in profits. Since then, they have written down the value of the assets they hold by $107.2 billion, gutting their earnings and share prices. Worldwide, the reckoning totals $380 billion, much of which reflects a plunge in the value of tricky mortgage investments.” Even Starbucks is finding it harder to keep coffee in the Black, and it appears that virtually the only firms seeing Black this year are the ones drilling for it.
S.C. = Santa Claus or Stimulus Check?
Let’s face it! Financial firms are now on debts’ door, with bad REO’s - and bad CEO’s - flowing through them like a SIV. But old habits die hard, and in spite of all of the Frannies and Freddies on the “Naughty List” this year, I was still planning on coming to town in the Nick of time - if it weren’t for your elected officials. Apparently your government (with cooperation from “Has-Ben” Bernanke) could only wait until Easter this year to distribute their gifts – sending out millions of “Stimulus Checks” 7 months before the official season of giving – and I’m still a little miffed that last year’s Hanukkah Rally preempted my signature Santa Rally on Wall Street, so I’m canceling that event this year as well. (Plus, it sounds like both of your presidential candidates have begun “Playing Santa Claus” – promising not just a “check-in” every pot but also an electric car in every driveway - so I probably won’t even be missed).
Instead, I’ve started hanging out with the Grinch, who’s already complaining that he can’t steal Christmas because the forces of lagflation already did (see article “Banks, Tanks & Angst: How Long Will America Idle?”) and all the while maintaining that he was “Green before Gore.”
I’ll Be Home for Christmas (for Once)
Frankly, I think this will be a good year to “skip the trip,” as the economy and real estate market are so bad that even birdhouses are going into foreclosure. Local authorities recently installed security cameras to ensure that their Nativity scenes remain in stable condition (as the price of gold, frankincense and “mirth” make them popular targets) and there’s already a waiting list for Wii’s Three Kings. From my vantage point here at (what’s left of) the melting North Pole, it’s going to be a stern Bear market for at least another year, so I’m going to follow their lead and just hibernate (the original “Staycation”).
Note: If I do decide to return in 2009, there will be new rules. With coal trading at over $100 per metric ton, only the children on my nice list will get a lump in their stocking.
In summary, in conclusion, and to review – Santa Claus is not coming to town. There won’t be any Miracle on 33rd Street, Wall Street, or Main Street in 2008, but I’m not alone - heck, even the geese can’t afford to fly south this winter. So go ahead Grandma, don’t be afraid to walk home on Christmas Eve – you won’t have to worry about being run over by a reindeer this year!