Today was a spectacularly bad day for the stock market. This Bloomberg story sums it up quite nicely. Sadly, I believe that Wednesday is going to be far worse for that is the day that The Fed is scheduled to release its famous Beige Book report. I’ve been watching this reporting with great interest because every time they unveil the current economic conditions the market tanks. I can’t imagine that it’s going to be any different this month, and since we’re already WAY down I can only imagine the worst this month. Because of this my new investment strategy is to invest only on the days that The Beige Book report gets released. At the closing bell on Wednesday we will know if my “system” has any cred.
Nobel Prize winning Economics Paul Krugman wrote in his Times column today that our current economic situation has gone way beyond a sub-prime crisis and can be more accurately described as a “global debt crisis.” This is what happens when too many people live large for too long a time on borrowed money while there is little oversight. Behold the end of Reaganomics… Lucky us.
In the beginning we had Gordon Gekko who epitomized the bravado of the financial sector during the 1980s with the phrase, “Greed, for lack of a better word, is good.” Little did we know at the time that old Gordon would morph into a reality even more insidious than the fiction behind him as time marched on. If Gordon Gekko and the movie “Wall Street” marked the dawning of the end, then Bernie Madoff singlehandedly embodies the fruition of the deregulation and excess that decades of greed and selfishness have brought upon us.
2009 is going to be a real bitch…