Saturday, 17 May 2008

Suddenly, they stopped saying this was a repeat of the Great Depression...

Just over a month ago I posted that my NW had dropped back below A$1m (for only a couple of days as it turned out). At the time there was a whiff of panic in the air, with some mainstream media starting to muse that "this time" we might be in for another bout of stagflation (like the 70's), or that we may even have a depression not just a recession - perhaps a worse depression than in the 1940's...

A month later my NW has rebounded almost 10% from it's recent lows (wouldn't you love that rate of gain to continue for another couple of months), and it looks possible that my NW could set new highs by the end of this year (though I doubt it). Funny thing, in the last few weeks I haven't read any more articles about this being the end of the financial world. In fact, some people are starting to say that the worst may be over. But with oil still setting new highs on a regular basis, the sub-prime fiasco may just end up being a footnote in the economic history of the first decade of the 21st Century.

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2 comments:

The Skilled Investor said...

Perhaps this is because the financial press has the attention span of a gnat?

Alex Fotopoulos said...

I've noticed the same thing. I take it as a bearish signal for the short term. Oil prices have to hit consumer's pockets eventually and slow buying.