The Dow stabilized yesterday… but the dollar continued to drop.
“I sold all my stocks,” said an old friend yesterday. “I just think this is going to get worse.”
Our old friend is neither an economist nor an investment analyst. But he dresses well. He was wearing square-toed shoes long before other men we know. He is a trendsetter; maybe more in tune with the ‘zeitgeist’ of our time than an economist would be.
Success is a hard thing to overcome. After so many years of generally rising prices, it is hard to see a downturn coming. Here at The Daily Reckoning, of course, we have been seeing a downturn coming for the last eight years. The economy needs a correction; we’ve been waiting for one for a long time.
But now, for whatever reason, our friend feels the time has come.
We don’t know, but we find a sense of gloom spreading within our own business. On a conference call last night, we found our US-based colleagues unusually fearful.
This is not the time for new projects… not the time to make new investments… not the time to take risks, they seemed to agree.
It is funny how these attitudes creep up on you. They come in the night, when you don’t see them. You wake up in the morning and they have taken over your body. You find yourself wanting to slash costs… slash capital spending… and slash your wrists.
It may be that the fundamentals are exactly the same as the day before. But suddenly, you sense that trouble is coming… and that you had better be careful.
The Daily Reckoning Australia