Friday Asian Markets Down
(Conspiracy Nation, 08/17/07) – Choppy seas ahead, matey, as preliminary indicators for today cause sailors to take warning. Japanese shares down 5.42 percent. Hong Kong shares down 6 percent. Malaysian market down 5.08 percent. South Korea down 3.1 percent. Australian shares down 0.70 percent. New Zealand stocks down 1.63 percent. (“Bruised Asian stock markets dive further,” Aug. 17, 2007. http://www.channelnewsasia.com/stories/afp_asiapacific_business/view/294525/1/.html)
In Europe, latest reports are that markets in Paris and London have clawed back some ground on Friday at the end of a harrowing week which saw a fierce global sell-off. (“European stock markets struggle after Tokyo plunge,” Aug. 17, 2007. http://www.channelnewsasia.com/stories/afp_world_business/view/294557/1/.html)
There are conflicting “Federal” Reserve cash infusion reports from yesterday. One source says $7 billion was injected Thursday. Another source says it was $17 billion.
Conspiracy Nation intuits the panic which began around August 10th has begun to subside. (“Market: A Tough Nut To Crack,” http://www.shout.net/~bigred/ToughNut.html). There may still be wild gyrations today, however. The truth about what has been going on is slowly coming into focus. The root cause of the panic has been sudden doubt about the solidity of Collateralized Debt Obligations (CDOs). Credit-rating firms made wrong calls on many securities. Overly benign ratings by such as S&P, Moody's, and Fitch were later reversed. Unfortunately this snowballed into loss of confidence across the board. Former House majority leader Dick Armey yesterday, in an opinion piece in Investor's Business Daily, cleared away the cobwebs. At least 85 percent of the CDOs are basically solid. The problem at the moment, due to lack of confidence in the ratings agencies, and not necessarily in the CDOs themselves, is in knowing which CDOs are solid. Banks are trying to sort that out. At the moment, since it's hard to tell the good from the bad, CDOs in general are being shunned.
Robots, disguised as world leaders, are programmed to appear and declare, “The fundamentals are sound.” This robot scheme has been in place since at least the time of Herbert Hoover. This has been the “leadership” in the crisis: To have robots appear and chant, “The fundamentals are sound.”
In the U.S., for some reason, Treasury Secretaries are always from Goldman Sachs. This means either that Goldman Sachs is now an arm of the U.S. Treasury, or worse, the U.S. Treasury is now an arm of Goldman Sachs. Last year, the new Treasury Secretary, Henry Paulson, arrived from Goldman Sachs carrying “meltdown scenarios.” Then Lo! A “meltdown scenario” seemed to unfold! Somewhat independent of politics, Ben Bernanke, “Fed” chief, has tried not to go bonkers. But even Bernanke has too much faith in liquidity as panacea. The kindly professor has no idea there could be skullduggery affecting the markets, over and above what is just a correction.
Caveat: This is not investment advice. No responsibility assumed for investment decisions.
Conspiracy Nation
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