jstratt

A Summary of Q1 Bank Earnings: World, You Just Got Hustled

I appreciate the authors many fine points. When someone provides lots of rationale for their conclusions I listen closely.

At the same time the history of banking crises suggested to me that many of the things mentioned above would happen. Down through history similar steps although not the exact steps have occurred.

It is not in the interest of any country to have a great economic calamity. The world financial leaders seem to have once again stepped in and continue to be prepared to intervene as required to stabilize international trade.

I am not suggesting a boom lies ahead. At the same time $15000 gold and a world economic freefall is not likely.

Seven Uncomfortable Predictions for the Economy

Jennifer, You really have a dark side. I like your perspective because it opens up avenues of thought. However I see it a little different and here is why.

1) Commercial RE - I agree this is a likely problem area. I do see refinancings which will help ease the problem. The Boston bldg that sold for 50% of its previous sale price is a harbinger. We will get through this however.

2) Insurance companies - Insurance has funding set aside and reinsurance and I dont think it will be systemic

3) Corporate bankruptcies - I am sure some will happen. It used to be companies went bankrupt once in a while and the world lived on. Someone else will buy the assets and be aggressive and grow their business.

4) Dollar - We have had the world by the tail. That may change but the dollar and the US are important to the world economy and will be for a long time.

5) Thrift - gosh I hope so! A few years ago I went to collect rent from some tenants who couldnt pay... They were living better than I was.

6) Crime and Boomerang - blah blah blah

Booms and busts have been going on for centuries or more. The US will not perish. I graduated around 1979 from college. Things really looked bad with 15% unemployment and 18% interest rates. It looked like and many people thought the US was in severe decline.

Cheer up! We will get through this and without every imaginable boogie man jumping out of a closet. I am curious what Bawden Capital is investing in these days given your outlook?

10 Reasons Why We Still Haven't Hit Bottom

I appreciate the authors perspective. We can debate about whether the bottom is in but I would encourage investors to think long.

1) It may not be the best time to buy stocks but it is a good time. Where was the fear at Dow 14000+ and where is the opportunistic aggression of a Dow 7200.

2) I could be wrong but I see 4% Mortgages creating some RE purchases and increasing disposable income through Mortgage refinancings.

3) Credit cards dont alarm me as the first 15% loss is probably a loss of interest and fees rather than capital.

4) World leaders are acting more or less in concert and are actively engaged. When that happens things ususally improve.

5) Business activity and earnings from a macro sense appear to be bottoming. I dont see fewer homes being sold or fewer cars being sold in the future.

Finally I have to add that I have never found a time not to invest. Whatever you earn save some for yourself and invest it. It always is a great time to invest in the best and worst of market scenarios.