Financial Aid Kicking In

As if things weren't confusing enough. Now we have various types of aid programs starting to impact the credit markets. No, the TARP program doesn't seem to be rolling just yet, but commercial paper facilities and other programs are now active.

What does all this mean?

To me, it means this. If the world collapses your money doesn't mean squat anyway. We'll all be living off of mushrooms grown in our basements as we hide from our neighbors.

However, no government is going to allow this to happen. So, while we are watching wild hysteria and so forth gripping the world, it's a mistake. In the financial sense it's always a mistake.

Does this mean we should jump in?

No, it doesn't. The markets, and the world, have the ability to stay irrational far longer than any leveraged entity can remain solvent if caught on the wrong side of a financial prediction.

Damn. A quandary. I hate quandaries.

Look, as always happens, we are seeing panic drive down equity values too far. We are seeing currencies and commodities being hammered mercilessly. These are being driven down too far. It's not the end of the world. This too shall pass.