2B optimistic: this is the beginning of the end

BREAKING NEWS

March 2, 2009

wsj
The Dow Jones Industrial Average dropped by 300 points to end below the 6800 mark for the first time in nearly 12 years, as a broad-based selloff seized the markets, sending shares lower in every sector. The S&P 500 briefly dropped below 700 for the first time since October 1996 before ending just at that level amid across-the-board declines, including drops of more than 6% in basic materials, energy, financial and industrial sectors. The Nasdaq Composite Index fell 4%.

For more information, see: http://online.wsj.com/article/SB123599406229708501.html?mod=djemalertMARKET

I REVEAL THE TRUTH:

ANGELA IS THE ANGEL

Yesterday, sent by the Aparecida no one is keen to listen to anymore,  the Angelo della Vendetta started  cutting some heads and share values, but it was only the beginnig of  the end. The necessary “Visible Foot” freeing markets from lame ducks (the von Hayek – and  – Schumpeter, neo Austrian Foot) has just started kicking off, and will have a couple of years of hard work ahead. The ecomomic “curtain wall” has not yet come down: then the neoAustrain Angel will have no pity, not even for her country of origin (Austria); it will be CEE (Central East Europe) Tsunami soon, and little will stay alive in Western Europe, after her mission.

On the other coast of the Atlantic, there is no reason for DJIA, now that 7000 is over, to land asymptotically or not towards 6000: still, the Western Actives would B by far over-valued, at 6000 (down from top 11,000).

a) DJIA passed yesterday, in a quantum jump below 6800 (My God!) the 7000 PSYCHOLOGICAL threshold of “depression”, i.e.  Wall Street finally cut the Gordian Node (FAQ: is this a deep recession or a depression? The latter. Now we know:

the answer, my friend,

is blowing in the East European wind.

For no apparent reason, in Wall Street: just ordinary administration – adjusting the e’s in the p/e ratios, to what one can reasonably guess for next Autumn, when all things that might have gone wrong, will have (Murphy’s Law, a secularised divulgation version of Greek Tragedy’s Destiny).

b) European, namely Italian banks are just disappearing, day after day from markets. This is no violation, as most people say (banks capitalisation below book value?), on the contrary: A STRICT APPLICATION OF THE FUNDAMENTALS. Such;

giant, monopolistic, hyper-speculative, anti-social, caparbiously authoritarian and highly inefficient with their personnel, vandalised by ignorant managers, enemies of the Territory where they just steal surplus value (no help to innovation, to anything) banks

should have never been born, as they did UNDER THE CRAZY, ANTI- ECONOMIC, MONOPOLISITIC CONCENTRATION WAVE of the New Economy, version 1 and 2, in the last two ABEs, Artificial Bubble Economies, 1993-2007.

Mr Profumo (legally and apparently the UniCredit CEO, still) is already at the job office to look for another place: but

FAQ – Who will hire such a crazy man, that ruined  in just one only stupid Ego trip three  healthy  banks full of Tradition (Cassa di Risparmio di Verona- Vicenza – Belluno- Ancona, Credito Italiano, and Banca di Roma)???

ANSWER: We want them back, our 3 banks, and we’ll get them before Summer. The Angel is working for Justice to triumph, on this Earth.

I knew in advance, but I did not want to disseminate pessimism: last week rally on Italian Banks was artificial, home made and effimero. A literal Tsunami is charging its batteries very speedy, then it will lead to the “SUBCRIME no.2 – The European version” Vendetta dell’Angelo Sterminatore (who appears to have occupied the soul of Angela Merkel, dictating her what she must do, in such a way as Destiny requires):

– 1. a default of the majority of the 10 CEE States unprotected by the Eurozone;

– 2. a national economy collapse, and consequent quasi-default or default of  the Austrian State (only by the immediate, direct consequences of CEE toxic credits, by applying a multiplier 2 to Dansk Bank scenario 3: Austria will lose 22% of its neutral GNP, this year; as we say below, with a multipler 3 it makes -33%; then self-reinforcing dynamics will carry on further the Visible Foot job);

-3.  the forthcoming closure, and “week-end X nationalisation” of the majority of large Continental European Banks (British Island ones are already kaputt: RBS is a Gordon Brown’s property, Barclays is 90% down in capitalization. from £90 to 8; Switzerland is  in search of diversifying out of Credit, which after all, ex post was not its natural Vocation; after weekend “X”, there will be an ephemeral rally on Swiss Banks, the  only private ones left, but it will not last long). More in:

– Dansk Bank Research last report, and continuous, daily information flow in their precious site, an Observatory on  € subcrime: http://www-2.danskebank.com/danskeresearch

– and the interactive graphic ft representation of Dansk Bank’s € subcrime scenarios.

REFERENCES: go to last week’s euro_exposure_to_cee_230209 Dansk Bank Research impact study, put into a graph by the Financial Times. Please note:

a) Dansk Bank worst scenario (alike the Asian crisis 1997) will B the best one soon;

b) this report just estimates Banks’ sofferenze, i.e. the 1st round of money-real transmission mechanisms, and repeated positive feedback interactions (ping-pong like). The full impact is, as usual, larger by an order of magnitude, so that the Austrian GDP, e.g., (-11% according to the Report) might approximately and optimistically (multiply x 3) lose no less than 1/3 this year, as a CEE Subcrime full impact consequence. Being so close to Austrian borders as we are, is no health.

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