Tuesday, September 25, 2007

Tuesday Thoughts

After a long weekend and then a computer problem early Monday (finally resolved), I am back in operation. I caught this article on Northern Rock over the weekend outlining their still reckless lending practices. Yes, those same lending practices that got them into the pickle they find themselves in. Are we supposed to be surprised and shocked they are still at it? What I am shocked at is that many are shocked that Northern Rock is still at it. What I am even more shocked at is Northern Rock showing as much as much responsibility as they are. They have nothing to lose and all lossese of covered as the Bank of England is behind them and the entire UK banking system. The BOE has de facto nationalised the banks which means all losses fall to the government(re: taxpayer) and all profits to the stock holders. We all know that the funds to guarantee the deposits do not exist, unless your idea of being made whole is being repaid with monopoly money.


I was at the Tiger game the other evening(they lost and sure don't look like the team they were last year) and had a conversation with a regional banking exec. whom I was a guest of. The conversation turned to housing/economy/markets and not knowing what I do for a living I asked their opinion of things, which was summed up in 5 words, 'the market can't go down' ! I broached some of the issues that I and many others have chronicled(housing, toxic paper,etc) and still the same, markets always go up. The blind faith in the Fed which sometimes borders on religion is fascinating to me, but more so is the absolute disregard of indisputable facts that are staring everyone in the face. The best part was when I mentioned the run on Northern Rock which resulting in a laugh, so I went on and mentioned the story of the hotelier and his wife who wanted their 1million pound sterling, and barricaded the branch manager in the office until a police orchestrated ending, again a hearty laugh. I am the weirdo for finding this stuff absolutely NOT FUNNY !


I truly believe that the masses do not want to hear the truth if it is negative or sour. Just this morning I caught some bubble TV (CNBC) and the had on a real estate guru Barbara Corcoran. She really disliked what another guest had to say about retail and the consumer (he was very bearish). To the point where she wanted his mic turned off. Isn't that quaint, turn his mic off, silence him, we don't want to hear it. She then went on to suggest that people who can afford their homes should take them off the market. Managed economies anyone, anyone, comrade !! She then, (laughing) suggested we all hold hands. That's it hold hands and have a seance, that'll fix everything. Good trading to you all.

2 comments:

Anonymous said...

Hi - love your blog. I was wondering why there are so few comments on it? Are there no bulls who disagree?

Harleydog said...

thx for the compliment. for now bullish on commodities/commodity stocks only.