World Panic, Crisis and $28 dollar oil

When we suggested some months ago that the Dow would probably stabilize around 8000…..and when we said that property values would probably stabilize at 1998 numbers…. and when we said that crude oil would make us happy at around $60 to $80 dollars a barrel……….little did we know just how unoptomistic we were!

Sure, we suggested that Pensions, Retirement Plans, 401’s, IRA’s, ROTH’s and Mutual Funds….were all going to get hit.  Now California and another 22 States are going through spending withdrawals of magnitudes unthought of ever in history.  Little did we know the depth and breadth of the “Credit Default Swap” market, the wide ranging use of the Derivative and Hedge fund markets to fudge bonus numbers for companies, or the outright global reach into every nook and cranny!

OK, we now can all officially panic!  Through it all, why is it that we still love George and Laura?  They just seem like such nice people.  George and Laura weren’t the the Fords…who were so pathetic.  George and Laura weren’t the Nixons who were so stiff and unsympathethic.  George and Laura were not like LBJ and Lady Bird with all their ostentations.  George and Laura also were not the quasi unprentious Jimmy and Roslyn Carter.  George and Laura also were never like the duplicitous Clinton’s!  George and Laura were not exactly like his dad George H.W. and Barbara either. George W. and Laura have been more like Ron and Nancy Reagan…in that, their sense of team appears such a deep and caring committment; with a great sense of decorum.  Hopefully, the next President and First Lady will display those properties as well.  Back to our tragic Global Economy:

As all the great icons of International Banking find that their feet have been made of clay….everything from Mini-Wonder Countries like Iceland, to Russia, to France, to England, to Germany all are facing financial meltdowns not seen since……how about ever?  We keep breaking new records daily.  In the last few months we have seen the demise of US Investment Banks.  The two that remain; Goldman-Sachs and Morgan Stanley have tried to switch their categories….making them sort of Non-Investment Bank, Traditional Bank, Investment Banks….subsidized by the Federal Government, Backed by a $1.3 Trillion dollar credit card limit…voted into being by a pliant Congress.

As the realities come to our awareness….like the fact that the original amount of anything provided or borrowed will be met with yet another request for more and more…..the joy of closure seems far away at this point. The terrible choices of Bail-Out candidate AIG, Inc. and their get-a-way retreat for their top “Independent Sales Heroes” at the Regis-Monarch Beach Resort to the tune of $444,000 dollars not 10 days after getting $85 Billion first flush cash infusion (too big to fail)…..was not so smart.  Especially, if you want to come back three weeks later and ask for another $38 Billion dollar taste….and especially if you realize….that $123 Billion is going to wind up being chump change for what you really need.  To their credit AIG has cancelled another scheduled “Sales Retreat” for this week at the Regis-Monarch Beach Resort. 

From our view, AIG, Goldman-Sachs and others should have never been saved and the $1.3 Trillion dollar “just do something – to stop the bleeding” Fed Bail-Out to “unfreeze” the “clogged credit market” has so far been a giant bust and waste of time.  We should have been busy re-evaluating Real Estate Markets in the United States – Commerical and Residential and rolling back loans to 1998 levels.  We could have stabilized various critical urban areas throughout the United States.  Without a stabilized Real Estate Market…..the Credit Freeze will remain.  Since lots of Foreign Investment is involved this is not an easy task to sort out quickly.  Taking away the Mark to Market requirements for anything right now…..seems criminal….doesn’t it?  How can we artificially just pay whatever someone wants when we don’t know the current and actual value?

The good side effect of the Global Meltdown however has been the fall in the price of Crude Oil.  Remember how important and required it was that we were Independent of Foreign Oil?  Oh, now that Oil may in fact return to price 1988 levels perhaps the day of the Muscle Car and SUV will still be viable.  Who knows?  It does show however how easy it can be to manipulate to price of oil….and work over any economy in the world.  Today, Crude Oil has hit $80.25 a barrel and falling.  What might the price be at the first of the year?   Bringing Crude Oil down to $28 dollars a barrel would launch a first class buying spree throughout the world of Auto’s, Motor Homes and Transportation.  Are we just dreaming here?  Hey, no one would have believed that Crude Oil would ever hit $147 dollars a barrel either!  Why not a solid $28 dollars?  Of course if that does happen, world Real Estate values will fall conmensurately.  Tough choices!  The reality is that many of the most prestigious companies in the world….unrelated to Financial Markets are also engaged in “Credit Default Swap Bonds”.  Check with your Boards of Directors …to make sure companies you are invested in – are not tied to the hemn of a dirty skirt.

Does it really matter who gets elected in November?  Yes it does!  Who do you think will be more concerned with the good or ill that may befall our country?  We leave that choice to people with love, caring and truth in their hearts!  It will be the most important choice that we may ever make in our lifetimes!  May a higher power guide our hands to make that decision!

About Ron & Anna Winship

Independent News Producers/Writers and Directors for Parker-Longbow Productions. Independent Programming which includes a broad variety of Political, Entertainment and Professional Personalities. Cutting Edge - a talk the flagship of over 30 URL websites developed or under development. The Winships have been blogging for the Orange Juice since back when nickels had buffalos on them, and men wore onions attached to their belts, because it was the fashion back then.