Archive for June, 2009
This spring bear market rally in United States seems to have ended. Accelerating upward from the minimum in March this year (minimum 13 years for the S & P500), barely responded to moving up a misleading without solid evidence, and very characteristic of the market declining. The U.S. financial system needs a genuine revival, rather than an injection of funds. It is a healthy deleveraging (reduction of debt levels) and not the generation of stimulus packages. The banks have been massively subsidized by the U.S. government. It inevitably leads to the impression of excessive currency is higher inflation, a weakening currency and higher interest rates. The financial system is falling down the drain and the U.S. government should react and convert debt into equity (cash value) to produce a more stable environment, said yesterday on CNBC Nassim Taleb, an economist author of “The Black Swan” is a classic of literature describing the financial impact of catastrophic events improbable. “If banks are going to go to mortgage borrowers with a smile, and they pose a lower monthly payments in exchange for taking the 60/70% of the property, would facilitate the orderly process of deleveraging. That each sector has a significant amount of the debt into equity. “Taleb added that this has been done, but requests that a systematic and massive scale to improve the system. Read the rest of this entry »