Where Do We Go From Here

7/3/08
The year was 1929 and what we knew of the existing financial markets had collapsed, brought down first by speculation and then by the very methods by which the speculation had grown.
All types of new regulations were then superimposed by the government to prevent future happenings of the same type. Year after year, industry after industry.

The trouble was that in doing so, the regulators continuously created loopholes for the few greedy types. And those loopholes have been utilized every few years....savings and loan crisis, derivative trading crisis, junk bond crisis, dot com crisis, mortgage crisis.....the list is endless. ultimately it is a lack of leadership, or worse, leadership that caters to the wealthy few versus the common many.

I am extremely upset and depressed that we have leadership in this country that is willing to let individuals, our US economy, and the world economy be so affected for their own and their clique's gains in the oil arena.

On July 2, 2008, I was literally on the phone as Sec. Treasury Paulson's prepared remarks were handed out and the market started to drop. Right then I knew that the markets would again be down sharply...his big point was that we had to look at new regulations for the new financial types of financial trading. No commentary on what was needed and what people expected to hear. Remember that he and the leadership and their friendly Saudis love what is happening with the oil crisis.....Goldman Sachs and all of Paulson's old friends are making back their mortgage losses at the expense of the general public.

More good economic numbers came out today, and despite some talking head warnings, two major financial institutions said that they did not need new cash. Both of those items got buried.

What will happen is that in spite of our non-leadership, the Fed will be able to tighten rates soon, strengthen the dollar, and oil will drop. Inflation fears will subside and the markets will have a good second half of 2008.

The key point is that not even energy positions are working in this market.....only the institutions able to trade derivatives and spreads using the dollar and oil are making the money, once again showing Wall Street cares nothing about Main street.