Comments on: Ugh

By: The Gambler

The Gambler — Fri, 10 Oct 2008 15:48:31 +0000

I agree Philip. Watching World Stock Markets over the last few weeks it does feel a bit like trading a 20-20 cricket match on Betfair.

That’s ok for a game of cricket, but you do feel the world economy/financial system should operate on a more sound basis.

By: Philip H

Philip H — Fri, 10 Oct 2008 14:24:51 +0000

It seems to me that all this financial finagling over the past 25 years or more is now dead and buried - hopefully.

Once upon a time banks used to look after our money and pay a little bit of interest on it; they would also lend “our” money for a bigger interest to people and companies who were sound. If you did not have any assets or collateral you could not borrow, end of.

Nowadays we have ordinary banks, merchant banks and other financial institutions inventing ultra-clever ways of lending and borrowing, often with money they don’t actually have, and gambling all the while that huge “investments” (gambles) return a very thin return. It’s like borrowing, say, £1million to back a 1.01 shot on Befair etc. One day, the bet falls over…

All I hope is that banking and lending eventually wake up from their nightmare gambling dreams and stick to the solid game of yesteryear.

By: The Gambler

The Gambler — Fri, 10 Oct 2008 09:49:04 +0000

Is it too early to say that we are witnessing “The Collapse of Capitalism”? Was it Karl or Groucho who said “I knew it was going to happen one day”.

By: shoreditch

shoreditch — Fri, 10 Oct 2008 06:09:37 +0000

As per my comments posted yesterday at 526 pm it is simply written on the wall that what you say above will come to pass. One big HF tried to liquidate yesterday in the last hour of NY with a fall of 700 points in the DOW. Even though, under normal circumstances there would be buyers around in a patently oversold market, since HFs, Mutual Funds etc are facing ~ 25% redemptions this quarter they are all forced sellers and supply and demand dictates we head still lower and in a more disorderly fashion.

Concerted interest rate cuts and fiscal stimulus packages have got to be on the agenda for today, central banks acting as a clearing house and guarantor for interbank lending will be the next and very necessary step.

Russia have closed their bourse for today, Indonesia ‘indefinitely’, and the developed world (G7 Nations) will have to follow suit next week until a solution to this is found.

It is scary out there