Feb 13, 2008

Ken Fisher on the credit crunch

This is actually just silly stuff. I just disagree with the other two gentlemen (Marc Faber, Jimmy Rogers) The fact of the matter is, normally, when you have a credit crunch, credit spreads widen very markedly before you ever get a ripple over to either the stock market or the broad economy.

If you take, for example, the year 2000, you've had credit spreads not rise by a few tens of basis points, but by four full percent in a year.

The fact is, this is just all minor volatility in a trend going nowhere, and is tiny compared to the forces that want to push things toward happier and better times right now. And this is all just fears of much ado about nothing, which, over time, will fade.

~ "Subprime Shockwaves," Bloomberg, July 26, 2007

No comments: