Recent Blog Posts
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The Times' Rorshach Geithner Story
Apr 27 20099:04am EDT -
Sinking Animal Spirits
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Counter-cyclical Urban Policy
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Be Your Own Counterfeiter
Apr 26 20099:04am EDT -
Being Tim Geithner
Apr 25 200912:04pm EDT -
Notes From a Press Conference Naif
Apr 25 20099:04am EDT -
What Good is the News?
Apr 25 20098:04am EDT -
Stressful Enough
Apr 24 20092:04pm EDT -
Not Regretting the Pound
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Introducing the New Ford Squeeze
Apr 24 20099:04am EDT -
Non-Economic Questions of the Day
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The Stress Test Blind Alley
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Happy Hour
Apr 23 20099:04pm EDT -
Recovery Without Rebalancing
Apr 23 20096:04pm EDT -
The Shape of Your Recession
Apr 23 20095:04pm EDT
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Howard Marks, The Optimistic Bear
Peter Lattman has the latest memo from Howard Marks, and it's not pretty. If you want the most bearish soundbite, this is it:
We've had collapses in the past, but never so broad-gauged and systemic.
Marks foresees some drastic measures on the regulatory front:
A holiday from capital requirements would allow regulated financial institutions to take writeoffs and clear their balance sheets without having to worry about falling below minimums. They might even try suspending mark-to-market accounting.
All the same, he's convinced that we'll get though this somehow.
The things one would do to gird for the demise of the financial system will turn out to be huge mistakes if the outcome is anything else . . . and chances are high that it will be.
Which means that, sooner or later, things are going to stop getting worse and start getting better:
One of these days, the herd will give up on there being a solution. And unless the financial world really does end, we're likely to encounter the investment opportunities of a lifetime.
Howard Marks has demonstrated that he's good at calling those inflection points. But unless you're Howard Marks, you might not want to try this at home.
