Wednesday, January 16, 2008

We Interupt This Program....

....for a call from my broker. Serious player. Connected. Perpetually optimistic. Very good.

He and I had a long conversation 2 days ago. Two days ago things weren't pretty but he seemed to feel the world was getting closer to understanding the full extent of the financial mess created by the asset backed paper disaster. There was cautious optimism and a pretty clear 'hold the course' line of reasoning. It's worked so far. I agreed.

He and I are good friends so there was only a touch of sheepishness in his calling me back 2 days later to tell me he's gone over to the dark side. His new perspective is very, very dismal. The US is going into recession. Spin-offs from the ABCP spectacular are wreaking every greater impact on other parts of the credit market. Banks, credit card companies, housing, consumer goods - you name it are in his opinion - and its not hard to find proof - going to get killed. Interest rates will decline to half of what they are currently. Further, given that no one still seems to understand the complete scale of what's going on, a melt down of spectacular proportions is no longer out of the question. When a 30 year veteran tells you this all new, uncharted territory both for him and for all those other so-called experts....holy #*&%#$!

So I have a choice. Guinness or Alexander Keith's Red. I could venture beyond the beer fridge in my office but it's only 10:30. I'm not up for that.

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