TUESDAY SEPTEMBER 30
Threat Assessment

As I mentioned last week, we are in uncharted waters. Well, now, we just lost our compass. I think that the failure of the rescue plan places the global markets in a condition where there is a meaningful possibility of complete shutdown. We will know more about this tonight, when we see how the rest of the world reacts, and more importantly, when we measure to what extent market participants try to hastily reduce their counterparty exposure to zero. This means calling in any and all cash available, and while I can’t say for sure it will happen, it’s a real possibility.

By: Ken Grant
September 2008

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