The today’s euphoria in the world’s markets is most welcomed and long awaited. After the Euro potential "bail-out" plan orchestrated this past week-end, a wave of long awaited optimism has stroke the financial markets, prompting a spectacular come-back for the main indexes. As I wrote this lines, the Dow, Nasdaq and S&P500 were all topping 10+% increases. That’s right: 10%! Everybody is exuberated like they’ve just came-out from a long nightmare and the happiness of getting back to normality is overwhelming. Which is true: both with the nightmare and the return to normality. For now, let’s enjoy this once again historical moments (after the huge drops in the indexes) and look forward optimistically to the future.
Then again, let’s also pay tribute to the the driving force behind it all, both fall and come-back. Here’s Mr. Douglas explaining it very eloquently over 20 years ago:
Hey!
I saw the link on your facebook page and decided to click on it to see what’
s it all about. I read some of your stories and they seems to be really interesting!
In my opninion, there are basically two different views on the current crisis from a student-perspective. On the hand, and let’s start with a negative viewpoint, it will be very difficult for us to find a job in the financial industry. Although I know they will recruit more for specific divisions like risk for example, the general recruitment demand is low. The more positive side is seen from a learning perspective. It is the best time to study finance related courses as the world is talking about finance 24/7! Relations between study and reality are made within a couple of secs!
I think we need to get used to this as students. The current problems can, in broad lines, be related to mortgage problems and its effect on the interbank lending rates. I think there is more to come. I’ve raised the question about the “less-risky” Alt-a mortgages before, and yesterday ING announced the first massive write-downs on that portfolio. Furthermore, in times where the economy is not doing well, people tend to spend more on credit. With the holiday season only a couple a weeks from here, I think the amount of credit outstanding on credit cards will increase even further, leading to a third risky factor for further defaults and write-downs.
I just felt that I wanted to contribute something in this comment. I’ll bookmark your blog and visit it some time more often. Keep up the good work!
Edwin