The American Spectator

The Nation's Pulse

After the Earthquake

By Barron Thomas on 9.19.08 @ 12:07AM

(Page 2 of 2)

But what's important now is what's next? Is there any "Hollywood ending" in sight?

The answer is thankfully YES.

The happy "Hollywood ending" is probably 24 months out, but it's there.

But first, there will be a lot of soap-opera style small cliff-hanger endings en route. I predict there will be at least two more big-bank "mergers/failures" and probably 50 or so small bank mergers or failures. Sorry, but we all know. Doo-doo always flows downhill.

After the election, things will start to sober up slowly and people will tire of the bad news headlines. Credit will still be tight until the banks start healing and making money (like 1990-1992). Short of a major, presently unforeseen calamity, gold will stay about where it is today or within a 15% trading range. Ditto on oil.

The steep decline in housing starts, coupled with the stork never stopping, and a gradually healing banking system, will slowly start invigorating home values, but not to the extent that your home becomes a huge Visa card again.

The Hollywood ending will be enjoyed by all, but by some more than others. The "some" will be smart boys who are now assembling huge vulture funds to pick up the gems among the carnage following the garage sale of Lehman and similar disgorged assets. It will be a very, very Hollywood ending for this group.

If you get tired of watching over-paid CEOs squirm on CNN in front of TV-mad congressmen, just switch the channel over to Days of Our Lives or All My Children. The plotline won't be much different, but the characters are better looking.

Stay tuned for more.

Letter to the Editor

topics:
Trade, Business, Hollywood, Oil