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We'll see what today brings, but I really think that the game is over for the financial markets. Listen for this phrase: mark to market. This is the big fear, and I think why the people running the financial markets keep bailing out (or taking over) these big institutions - because actually unwinding their positions on the open market will expose the real value of these financial instruments, and this will force everyone else to mark to market on their own similar assets. In other words, a lot of the supposed value in these complex financial instruments (like credit default swaps) is overstated by their holders and even though everyone sort of knew this all along no one has wanted to admit it since everyone was making so much money. But we might be at the end in a rather cataclysmic sense. Sure, the fed can just print as much money as they need to keep propping it up, but that gets us hyperinflation which will just be the end from a different direction.

My grand economic plan of having no money is really starting to look good!

- jim 9-18-2008 1:48 pm [link] [29 comments]