| Around
the world, financial institutions managed and operated
by experts using computer models have built investment
portfolios so intertwined that a relatively small group
of delinquencies & defaults is bringing the global
credit market to a standstill. |
|
Suddenly the global profit / risk-aversion equilibrium
has ratcheted to a grinding, halting stop & go. Capital
and tangible assets are being frozen then liquefied at
disparate valuations. Capital availability ebbs and
flows. Assets cannot be accurately marked-to-market in
markets that are illiquid. |
|
Today's crisis in confidence results from years of the
"Just do it -- I don't care" psychology. |
| Today's credit freeze is based
upon a well-founded perception that myriads of executives,
policy makers, & staff are an untrustworthy conglomerate
bunch who, operating in quest of immediately maximized
returns with little regard for tomorrow, will jigger and
misrepresent valuations. You would not loan them your money
today and you may be less likely to tomorrow. |