Interest Rates? Really, who knew they could actually be important after Japan's experience. I think you have to dig a little deeper. I think you have to ask yourself, in the cold hard light of day, why is it that when short rates in the U.S. crashed from 6.5 to 1.75, the market said nyet.
Because the damage was already done, it was systemic, and it was (and is) the same liquidity trap that Keynes so famously found in the system in 1931. I.e. there are far too few willing suckers to suspend disbelief and keep on floating the vig to the game. They want some flesh. They want assurance. There is none. Smart money reads things like the Cook Report. Heard abuut it, eh? Smart money reads that certain sectors like, ummm, ILECs, for a salient example, are all TU before '06, and they wonder about the Standard & Poors rating on the T '28 6.25 juniors and they wonder.... what happened to the Excellents, or at least the Above Averages? And they don't have any answers. The illusion ends, the bubble bursts, the assets assimilated. And the stockpicker? Just a high falutin' rag picker. Stripped of all his dignity, all his fancy warp and weave, left a shredded vestment of his former fine vestment, wondering, why, why am I to be a hoodoo. Lost in the desert. Seven years of famine, seven years of drought, seven years of plague.
The good news is, of course, we're a multitasking culture, so all this stigma and stigmata will be condensed. Buy (sly little hint fer ya) 2008, things ought to be looking up from a very long fallow period in the cycle. Of course, we don't have none of the stinkin' cycles in the "New Economy", but alas, turns out that in the end, we're actually in the same economy we've always been. Plus ca change, la plus l'meme chose, eh? |
