Comments on: RBS Publishes Global Stock and Bond Crash Alert

By: Richard Kline

Richard Kline — Thu, 19 Jun 2008 08:25:00 +0000

I have no read on whether the time frame is three months or nine, or over three to nine, but I would be flabbergasted if we don’t have an equities decline of a quarter, or even a third to the trough. There is so much not to like, nothing to like, and too many historical parallels for the kind of box the US macro economy is in for the numbers to remain where we are. We made it past a point in late May-early June where we could have had that kind of correction, so the idea that deterioration could begin to bite by mid-July is something I see as well-phased. But we may not see this hit until October, just as likely. Will it happen? Bet on it.

By: mxq

mxq — Wed, 18 Jun 2008 21:10:00 +0000

Yves point about the Heisenberg uncertainty principle is spot-on. The very essence of a “crash” (aka a black swan) is that you can’t predict it. 9/11, the 1987portfolio insurance run and LTCM couldn’t be seen until after the fact.

btw…”focus on quality…non-cyclical…names”…

isn’t that be true in any environment? Put another way, does the note to clients really have to drop a “crash” bomb to convince them of this?

By: Jojo

Jojo — Wed, 18 Jun 2008 11:15:00 +0000

And why can’t you anonymous people choose and use a name when making your comments?

Just click the name/url button andyou’ll get a box to fill in with anything you want. Makes it easier to reference a prior comment that way.

By: Jojo

Jojo — Wed, 18 Jun 2008 11:13:00 +0000

hee, hee.

CNBC has been all over this tonight. And seems many of the "pundit" guests are saying "no way Jose", "Can't happen", "Wont' happen", etc.

It is a gutsy call though. A lot of their clients are going to be very upset if this predicted crash doesn't happen by September/October.

And if it does, it will certainly throw the election into turmoil. Voters will be head hunting for sure.

By: Anonymous

Anonymous — Wed, 18 Jun 2008 08:39:00 +0000

With some peak oil observers stating the deletion may be 8-10% in the next decade, it will take quite a bit of demand destruction just to keep oil prices from rising. For oil to fall, the global economy must fall into a severe recession.

The stock market is boxed into a horrible corner.

By: Anonymous

Anonymous — Wed, 18 Jun 2008 04:38:00 +0000

“but at attack on Iran would send already high oil prices to ghastly levels”

Wouldn’t even have to be that extreme, a hurricane in the gulf would probably do it. July and August are almost here and with La Nina this could get real nasty.