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January 14, 2010
When you listen to the investment boys and girls on any of the business networks, what do you hear? Let me be a little more specific: Have you ever heard one of them say not to buy into what they are selling? Sure, you’ll occasionally hear one tell you that “now” may not be a good time to buy a particular stock or commodity, but you’ll never hear one tell you what they’re selling is not a good investment. What they’re selling is always a good buy.
How does any retailer get you to buy their product? They hype it up and convince you theirs is better than the next guys, and certainly a better deal. For example, if they’re selling a gas-guzzler auto, they are going to tell you gas prices are going to come down. Or, they’ll “justify” how being a gas-guzzler is really an asset, right? So how does an investment manager get you to buy his goods? He hypes it and minimizes anything and everything that might have a negative effect it. In other words, they’re going to be bulls — not bears; no matter what the market is really saying. It’s a self-serving pitch. But there are exceptions.
Experts all over the world keep telling us the market is moving to far, too fast. In fact, when the central bankers recently met in Switzerland, they issued a warning to banks that says they are overrating the improvement in the economy and financial markets (see 1st video below). And several others are telling us the same.
Doug Kass is a general partner of Seabreeze Partners, an exclusive investment company. He was recently interviewed by CNBC (see 2nd video below), and Lee Brodie, a producer for CNBC, wrote an article on Kass. And Kass says the market is in for a correction, which could be as much as ten percent.
As the article points out, Kass is known for being a bear but he’s also know for being right. He correctly called the subprime crisis and the bottom in the market early last year, as well as many other correct forecast. Kass has credibility.
While the tribal chiefs are sitting in front of an official government inquiry commission trying to tell them and the rest of the world what good responsible business men they are, their underlings are behind closed doors doing exactly the same thing that brought the markets and country down less than two years ago.
Investment managers and traders on Wall Street are no longer even denying they’re “day traders”. In fact, they’re practically encouraging it. So what does this mean for the rest of us — the ever day working stiffs?
It means that any recovery is going to be substantially set back by the same people with the same greed that brought us to this point. It means the suffering of the common people is going to be longer and deeper than it needs to be. It means our pockets will be further emptied into the pockets of the elite. And much more.
The so-called capitalist of our country have set us on a certain path of destruction, and our spineless government is powerless to do anything about it. But there will come a time when the common people will set aside their differences, particularly political differences, and stand together. When that happens it won’t be pretty. Let’s just hope it won’t be too late.
Video One
Video Two
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