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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum
GLD 399.01+0.1%4:00 PM EST

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To: TobagoJack who wrote (28394)1/25/2008 8:31:45 AM
From: carranza2  Read Replies (2) of 218602
 
Who know what the Fed will do.

It doesn't really matter.

Rate cuts are counterproductive.

Banks are screwed.

There will be no foreign investors saving US banks for one very simple reason: they are leveraged to the hilt. What investor would want to buy into a bank whose fantastic results on the way up were leveraged going both ways?

And if foreign investors don't come in with fresh capital, what then?

It would take massive injections of capital to save banks. I don't think any rational investor will want to buy into down-sliding leveraged stuff that the banks are toxic with because leverage magnifies losses.

CDSs: the elephant in the room.

The only thing that will prevent massive losses is governmental intervention, Congress by fiat saying, "CDSs are illegal and cannot be enforced."

Could happen at the bottom.

Cheers!
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