spoke with guy at sports club last night concerning JPMorgan
interesting conversation, bright fellow, some strange views
but all in all, head & shoulders above the rest
we talked first about JPMorgan
he said they would have been killed except for Sumitomo Bank injected $2.5 billion of cash
in return for a large piece of JPM's soul and future (if one exists)
my guy said that money will buy them one year, TOPS
we covered Citicorp
we agreed their South American debt exposure is much bigger than JPM'
but its pockets are just huge, with Travelers Insurance shared capital pool
he said if Citi were to write off $100M in gold losses, it would represent something like 3-5% of their cash on hand
he said Colorado and Arizona will each go bust from state financial stress
he works in industrial equipment, which covers miners
his comments were focused on industrial metal mining
each state will continue to worsen economically, with lost jobs
each state has very large mining operations, outside precmetals
he agreed that gold's run had as much to do with the economy and low interest rates, as it did with Iraq or MidEast
but he was not willing to jump in JUST YET
he thinks the big moves will come later this year or next
we disagreed on a host of other matters
he thought that Clinton's economic miracle was brought about by raising taxes across the board, which brought prosperity
I told him his head was up his ass, believing taxation could promote wealth creation
we get along well enough to speak freely
I said it had more to do with two major items
1. Clinton-Rubin sold half our nation's gold, used it to subsidize TBonds, which led to USDollar uptrend, attracting foreign capital, stock gains, lowered corp costs and rising profits
2. Japan caved in, gave up on its own future caught in stagnation and political inaction, and sent to USA over $600 billion to invest
he said he was not convinced on either of my items
no way to prove much in this strange arena
thought I would share my guy's update
smart fellow, nice engaging guy
but I dont think he reads much at all outside his domain
we talked while he was on a standing bike
I was between miles on my indoor track run
/ jim |
