Interesting read over at Index Universe from John Serrapere. It is a pretty honest assessment of the markets, but it isn’t the most hopeful. However, I agree with his line of thinking. As I have stated previously, too many people are using analysis and projections from the previous three recessions to base their projections for this one.
I think analysts are remiss if they are not using the Great Depression as their basis. This is not to say that we will endure the same outcome as that generation, but we are experiencing a downturn caused by extremely easy money and too much debt. What does alarm me with this downturn is we have even more debt than they did back then, and the Fed has created even more money than the Fed from yesteryear – primarily due to the gold standard being in place during the Great Depression.
Similar to the Great Depression, we are witnessing a massive amount of government intervention and stimulus in the markets, which didn’t work then. This government tinkering in the 1930’s coincided with the belittlement of capitalism and business owners, much like today. But, I could be wrong. Maybe we can get rich through debt and excessive spending (insert sarcasm here).
What say you?