Malkiel

Financials To Resume Meltdown Momentarily

"we always under estimate the consumer and their need to spend on themselves and their children without including intangibles"

Be that as it may, over 2 million households will have been foreclosed by this time in 2010. I see those as households whose financial and emotional crises will take them out of the consumer economy for a decade or more. Doesn't 2 million households sound like a lot to you? I can't imagine the consumers returning to their place as the engine of the economy any time soon. Especially when the credit card debtors discover what the real estate debtors have, that there's safety in numbers and defaulting with the crowd is a sound strategy for the overextended.

As for short selling, indicting a couple of traders and brokerages should do the trick. Nothing like a good execution now and then to keep order on the street...

Credit Cards: The Next Subprime?

In the 90's there was alarm because credit card debt per capita was skyrocketing as credit card middlemen Visa and Mastercard whipped up tons of new debt for their bank customers; then those customers got out from under their debt by using cash from mortgage refinancing, new debt that mortgage company middlemen whipped up for THEIR bank customers; now the consumers are getting out from under their mortgage debt by transferring debt back to their credit cards. There are two interesting points here: firstly, banks are suckers for the machinations of middlemen; second, all forms of debt are probably being shouldered by the same few dumb banks, so expect more writeoffs for credit card losses from the people who had to write off mortgage losses...