The Perp Walk!
Thursday, October 30, 2008 at 8:43AM by Kip Herriage -VRAInsider.com This bear market has lots of people scratching their heads, especially the so-called gurus of capitalism and self-proclaimed Masters of the Universe (by the way, this is a great time to go back and read Tom Wolf's classic from the 1980's, The Bonfire of the Vanities, Wolf's semi-fictional work on the lives and mindset of Wall Streets super elite).
I speak with a diverse group of people on a daily basis about the shenanigans that allowed this derivatives and leverage implosion to take place; the very wealthy to the not yet wealthy, the well-educated book smart types to the cleverly street smart, and the optimists to the pessimists. One of the comments/belief systems that seems to unite all is: "These guys are getting what they had coming to them for a long while, but why aren't any of them going to jail?"
And here's the rub. There have been no indictments, no charges filed, no serious investigation, and most importantly.....no "perp walk"!
I believe that complete confidence in the system has been lost, and that until we see the perpetrators in handcuffs and sent to long prison sentences, along with significant changes in the way the game is allowed to be played by the "elites", that investors (globally as well) will simply put their hard-earned money somewhere else....some place that they can actually see it grow and have faith that it won't be robbed in the middle of the night.
Market Update: As predicted, the FED cut rates by 1/2 point yesterday, and global rate cuts will be next. We likely have some more room to run on this bear market rally, but as I said yesterday, if you have some positions you want to unload you may want to use this rally to take some money off the table.
For the last 4-5 years I have been saying the following: "80% of the country is upside down financially. This means that if 80% had to either pay off their debts or file for bankruptcy tomorrow, they would be forced to file for bankruptcy". This is not the definition of a strong middle class, and without a strong middle class, a country cannot prosper in the long-term.
Kip Herriage
Reader Comments (1)
hey dad ur beast good job keep it up.