Melts in Your Wallet, Not in Your Hand

[spartonboat1]

Given the financially knowledgeable members of this forum, allow me to inquire on three questions:
) The Fannie M and Freddie M Golden Parachutes blow me away. Is there any recourse to pull those back? Was there any malfeasance, i.e. breaking of law?
2) Lehman Bros into bankruptcy- I note that their CEO's stock value has fallen from $440M to $44M! God help me, the feds better not get into this one. What form of free market resolution will occur and what is the impact on the US economy.
3) Merrill Lynch just sold to Bank One. What was that all about? What is effect on economy?

Finally, I hope someone explains to McCain that higher taxes will fix none of above. I blame the mortgage meltdown solely on the Feds and pressure from politicians to give a mortgage to anyone who could fog a mirror (and some who couldn't).

[Genesis]

Go read http://market-ticker.denninger.net

It should explain most of it.....

This is an unholy mess and the worst part of it is what The Fed did today - they are effectively now margin lenders in the stock market.

This is very un-good in that their losses go to...... you via the Treasury.

Yeah.

[krush]

There is a very simple explanation of this mess: BEND OVER and GRAB YOUR ANKLES

[67hat34c]

Already too sore there so I cant take it again.

[Passages]

Well....now what?

Last year I had a hunch things would get ugly so I moved most equity holdings to cash when DOW was just under 14k. Thought about taking a 10%position in precious metals but hesitated.

We may be entering a deflationary, credit tight economy. Something I've never seen before.

As I write this, DOW is around 11.1k. What's an investor to do?

-Jump back into equitities? We'll, if things continue to unwind we are nowhere near bottom.

- Buy gold? If deflation comes to roost, gold should drop in unit cost as fewer dollars will buy more.

-Buy real estate. Perhaps. As banks foreclose, there should be opportunity - BUT don't go with luxury real estate. Focus on the budget market as more folks tighten their belts.

- Stay in treasuries, bonds and Money markets. Not very exciting, but stability may a winning strategy. Even if yields go to 1%, deflation will augment yield with increased buying power.

Just don't know how to play this one.

[34Hatt]

Well....now what?

Last year I had a hunch things would get ugly so I moved most equity holdings to cash when DOW was just under 14k. Thought about taking a 10%position in precious metals but hesitated.

We may be entering a deflationary, credit tight economy. Something I've never seen before.

As I write this, DOW is around 11.1k. What's an investor to do?

-Jump back into equitities? We'll, if things continue to unwind we are nowhere near bottom.

- Buy gold? If deflation comes to roost, gold should drop in unit cost as fewer dollars will buy more.

-Buy real estate. Perhaps. As banks foreclose, there should be opportunity - BUT don't go with luxury real estate. Focus on the budget market as more folks tighten their belts.

- Stay in treasuries, bonds and Money markets. Not very exciting, but stability may a winning strategy. Even if yields go to 1%, deflation will augment yield with increased buying power.

Just don't know how to play this one.

I do It is time for you to buy a Boat go boating and stop worrying about it
And your wife will be happy. So I will help you find a sweet one next month

[krush]

Just don't know how to play this one.

Vacuum bag, desiccant/O2 absorber, pvc pipe, cash, and a hole in the ground.

Also, dry storage space, lots of beans and rice. And if you can, a couple thousand gallons of fuel.

[Bob Bradley]

Vacuum bag, desiccant/O2 absorber, pvc pipe, cash, and a hole in the ground.

Also, dry storage space, lots of beans and rice. And if you can, a couple thousand gallons of fuel.

You left out ammo.

[Genesis]

Preserve capital.

Asset deflation is what's happening as the leverage comes out, some of it coming out violently.

[Passages]

Now I'm reading that we are NOT heading into deflation, but hyperinflation in the near future.

Does ANYONE have an economic model that can make sense of all this? I kind of agree with Genesis & Krush about the need to preserve capital BUT if the FED starts diluting the dollar, doing nothing will evaporate static currency.

Maybe I should just buy Turners 55 Hatt for $399k cash before he changes his mind.