Don't ask me why or how, but there was an IMF meeting a couple of days ago in Washington DC, and me being still in New York, I had the opportunity to talk to a very senior, influential gwailo friend ... I asked for his assessment of just how bad the whole crisis had been over the last few days. His comments shocked me.
Like the rest of the world, we were shaking our heads over the daily dips of 5%-10%, but we also thought that things would stabilise once the central banks of the world got their act together. He said that on Friday, he had never been so "hapless, resigned to fate in a bad way". Mind you, my friend is on the board of two top 1,000 companies and has been on select committees on banking oversight committees. He has access to influential board members of the Federal Reserve and many of the top guys at IMF.
He said things were so ON THE EDGE last Friday, he felt the same way when the Cuban missile crisis was at its peak fervour. During the latter period, he was resigned to either side sending the nuclear missiles to each other and knowing in his heart that there is a very real chance that life as he knows it may evaporate in a matter of hours. Can you imagine a person comparing that to the the situation last Friday. He said that things were so "open and shut" that the central banks were in real danger of not being able to come up with the deposit guarantees and buying of stakes in banks. There was a real chance that all markets was going to continue to collapse further. He added that if people knew how bad things were behind the scenes, they would wobble at their knees. He said on Friday, he was willing to take a bet that the Dow Jones may hit 6,000 in the coming days.
His view has improved now. Now he thinks there is a good chance that things will work, that liquidity will return, but sees thing only returning to normal after 6 months.
p/s photo: Yuri Ebihara
12 comments:
I am worst than him, i am predicting DJ would hit 4000 points and HK will hit below 10,000 points.
Of course,tonight DJ may challenge agaist on 7900 points. If brokethis support, i think the above mentioned point may arrive on the corner. I already pray hard on that, my prediction is wrong, i wish i am 100% wrong.
I am worst than him, i am predicting DJ would hit 4000 points and HK will hit below 10,000 points.
Of course,tonight DJ may challenge agaist on 7900 points. If brokethis support, i think the above mentioned point may arrive on the corner. I already pray hard on that, my prediction is wrong, i wish i am 100% wrong.
Hi S. Dali,
This is a chilling post. To invite a comparison between the financial turmoil in Wall Street with the Cuban missile crisis is incredible. And, coming from an Establishment figure makes it even scarier.
However, it's good to know that you've got well-placed friends. It makes what you write even more weighty than it already is.
Keep the gems coming to us information-starved followers.
CT
Now, I guess everyone starts to question the effectiveness of bailout implementation.
To me, it is difficult to achieve unless there is one political stand. Recovery may start after 6 months if there is no other economic impediment in between.
Just cross my mind, will it make sense for the US Congress to allow the houseowner to withdraw their pension funds for their housing? This will help to temporary stabilize the house market. Perhaps this is already in place??
What had made him change his view,? a bit curious .
maverickspost.blogspot.com
Thank you for highlighting that. May really want to put my 'bulk repurchase' of the local PBB shares on hold at least for quite a while.
Sometimes its ironic that terms like liquidity , debts , shares be used in the world of finance, but its not applicable to aids to starving and dying people around the world.
This 3 days adi offset the DJIA huge gain (> 900 pts that day).
Any idea?
Finance market shall take some lesson from it. Top management company (CEO, CIO, CFO) shall reduce a payroll 20% at least to avoid be cut job, company need reduce the employee cost ..
Any idea?
Happy la you, in New York... right in the eye of the storm, witnessing the whole thing unfold... while the rest of us stuck here in a very wet Malaysia... raining everyday...
but then, at this time of the year...maybe New York also damn wet and cold... haha...
Humpty Dumpty sat on a wall,
Humpty Dumpty had a great fall.
All the bailouts, And all the unlimited cheapo banana printed money
Couldn't put Humpty together again!
It's 1930 all over again. This time though the stakes are higher. Who wins sets the rules for next generation.
I am also wondering he changed his mind, maybe because of money?
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