Letter 2008 12 30
Last Man Standing Financial Death Match Game
- Episode: End-Game, Darkest Interregnum and Hardest Money –
or
Journey to TeoTwawKi*, travelling to Argentina by way of Zimbabwe, from Japan
(TeoTwawKi – The End of the World as we Knew it)
Dear all, we believe in philosophical money management, and have faith in moral economics. We go by intuition based on history studies, and we engage in due diligence by way of biblical morality reckoning. For 2008, we, again, did better than most of the professional money managers and majority of the trained economists.
Perhaps by dumb luck, or maybe by acumen, we anticipated all that has transpired in the financial markets during 2008. We were, however, very surprised by some of the more outrageous happenings in the real goods markets.
This letter is a tally and a look ahead.
We are up 1.67% for 2008 on levelized marked to sorry market NAV basis (hooray, that was f$#@45-0$#@ing fun, but hey, at least we were not Madoff-ed), and given that the risk-free rate is zero, we have done brilliant against 99% of the wandering folks out there who are either oblivious or otherwise still foolishly wondering what had gone on and not afraid of what will be next, and waiting for the next tsunami wave to take them out and away, wondering no more.
The S&P 500 index scored a negative 40% for 2008, qualifying the year as the second worst for Wall Street, because in 1931 the share market in New York fell 47.1%.
During 2008, a multitude of people experienced losses from 25 to 50%. Most of the enough who had borrowed to invest, always a no-no, lost all or just about all or close to all or as bad as all, depending on their mental disposition. There were few sane places to shelter savings and wager investment monies during 2008, an unforgettable year that is now over and done.
We are afraid, for fear is a survival trait, and we want to panic, because panic is rational.
We are worried, because we have wagered enough, and we are sleeping, because we have not bet on uncertainty.
We suspect the worst is still ahead of us. We are of course assuming, perhaps unjustified, that re-imperial Russia will not be reaching for its former controlled space, Hindu India will not engage with Islam Pakistan, nothing greater than the usual will take place between Jewish Israel and its Islam neighbors, and bible-pounding America ceases its imperial tendencies before it is beyond too late.
In other words, we are hoping that the clash of civilizations is not part of this script and dark political tyranny will not tag along with monetary Armageddon. That is a mere wisp of a hope wrapped in a shimmering mirage served up within a puzzle built on shifting sand, and perhaps not even rising to the level of wishful thinking.
We are anticipating a monetary disaster. At the most fundamental level, simply put, and please excuse the biology references, the chromosome of money itself is beginning to disintegrate, and systemically speaking, the circulatory vessels that are banks and intermediaries and hangers-on, are bursting, important organs, be they previously productive enterprises or key nation-states, are failing, inflammations are flaring up in too many places, whereas localized temperatures on the streets of Athens and in the hills of Iceland have gone high and are trending higher even as portions of the body economic has frozen solid at the factories and ports.
Which is to say, the sequence of systemic collapse that we had long supposed would happen has started to go dire and doing so at a surprisingly fast pace; the officialdoms are reacting as expected and acting well beyond our expectations, making worse a worsening situation. That the officialdoms are making matters worse is not surprising, and in perfect alignment with choreography of monetary crisis past, forced by the known-known sweeping hand of history. That the officialdoms are making the worst possible situation worse still is a cause for alarm.
In a sentence, our current trajectory rushes us towards global zero-state monetary reset (“GZSMR”), beyond which lies in wait the Darkest Interregnum, a period of as yet indeterminate length of woe. This is the time passing between the end of one ruling monetary empire and start of the next decreeing money sovereign.
We should be expecting a once-in-5-generations monetary lesson, and therefore a once-in-a-life-time opportunity. Whatever happens will likely be of biblical scale and scripture impact.
Given that our heart is pure, mind clear, and money hard, we are OK with epic to biblically epic scale and meteor-hitting-earth impact. So we should be OK, I fret. |
