Crystal ball crushing, the new emerging industry

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I met with yet another senior banking official today and he again confirmed my pessimistic outlook in the medium term.  He said “We all crushed our  crystal balls some months ago” and all we know for certain is that the carnage has a long way to go.

He enlightened me as to another reason why the banks are being so “patient” by letting tens of thousands of mortgagee properties and insolvent developers stay afloat, and that is that if the banks take action they not only stuff the property market for some time but if they crystallize their losses it will significantly affect their bottom lines and THAT will affect their share prices.  So there is a significant degree of self interest going on that I hadn’t thought of before.

In fact it was fascinating to listen to his years of wisdom in dealing with the fallout of investment failure from a bankers perspective.  They often get a bad rap as boring or conservative but it was hard to fault his accountant like common sense.

It has often been said that common sense is very uncommon and that is often true isn’t it!

Anyway back to the topic, we can be thankful that the banks have as much of an interest in keeping things going as we all do individually because this is preventing the carnage we saw in the late 80′s when the banks showed no mercy.

So if you are in a good position today thank God and if you are still trying to see the light at the end of the tunnel be thankful that the banks are on your side, even if for their own ends.

Stay Inspired and Stay Safe ~ Dean Letfus @ www.MassiveAction.tv

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