Skip to main content

Credit Frozen & Cuban Missile


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

Comments

stockname said…
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.
stockname said…
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.
ctchoo said…
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
solomon said…
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??
successis said…
What had made him change his view,? a bit curious .


maverickspost.blogspot.com
wc said…
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.
CSK said…
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.
Ivan said…
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?
Andrew Chua said…
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...
Gamelion said…
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!
T T's blog said…
It's 1930 all over again. This time though the stakes are higher. Who wins sets the rules for next generation.
cheyann said…
I am also wondering he changed his mind, maybe because of money?

Popular posts from this blog

My Master, A National Treasure

REPOST:  Its been more than two years since I posted on my sifu. This is probably the most significant posting I had done thus far that does not involve business or politics. My circle of close friends and business colleagues have benefited significantly from his treatment.


My Master, Dr. Law Chin Han (from my iPhone)

Where shall I start? OK, just based on real life experiences of those who are close to me. The entire Tong family (Bukit Kiara Properties) absolutely swear that he is the master of masters when it comes to acupuncture (and dentistry as well). To me, you can probably find many great dentists, but to find a real Master in acupuncture, thats a whole different ballgame.


I am not big aficionado of Chinese medicine or acupuncture initially. I guess you have to go through the whole shebang to appreciate the real life changing effects from a master.


My business partner and very close friend went to him after 15 years of persistent gout problem, he will get his heavy attacks at least…

PUC - An Assessment

PUC has tried to reinvent itself following the untimely passing of its founder last year. His younger brother, who was highly successful in his own right, was running Pictureworks in a number of countries in Asia.

The Shares Price Rise & Possible Catalysts

Share price has broken its all time high comfortably. The rise has been steady and not at all volatile, accompanied by steady volume, which would indicate longer term investors and some funds already accumulating nd not selling back to the market.


Potential Catalyst #1

The just launched Presto app. Tried it and went to the briefing. Its a game changer for PUC for sure. They have already indicated that the e-wallet will be launched only in 1Q2018. Now what is Presto, why Presto. Its very much like Lazada or eBay or Alibaba. Lazada is a platform for retailers to sell, full stop. eBay is more for the personal one man operations. Alibaba is more for wholesalers and distributors.

Presto links retailers/f&b/services originators with en…

How Long Will The Bull Lasts For Malaysia

Are we in a bull run? Of course we are. Not to labour the point but I highlighted the start of the bull run back in January this year... and got a lot of naysayers but never mind:






























p/s: needless to say, this is Jing Tian ... beautiful face and a certain kind of freshness in her looks and acting career thus far



http://malaysiafinance.blogspot.my/2016/12/bank-negara-may-have-switched-on-bull.html


I would like to extend my prediction that the bull run for Bursa stocks should continue to run well till the end of the year. What we are seeing for the past 3 weeks was a general lull where volume suddenly shrunk but the general trend is still intact. My reasons for saying so:

a) the overall equity markets globally will be supported by a benign recovery complemented by a timid approach to raising rates by most central banks

b) thanks to a drastic bear run for most commodities, and to a lesser extent some oil & gas players, the undertone for "cost of materials" have been weak and has pr…