{"id":22823,"date":"2008-01-22T12:26:00","date_gmt":"2008-01-22T12:26:00","guid":{"rendered":"https:\/\/clusterfamilyoffice.com\/blog\/?p=551"},"modified":"2008-01-22T12:26:00","modified_gmt":"2008-01-22T12:26:00","slug":"crack-o-tormenta-perfecta-victimas-o-responsables-de-nuestra-situacion-patrimonial","status":"publish","type":"post","link":"https:\/\/clusterfamilyoffice.com\/en\/crack-o-tormenta-perfecta-victimas-o-responsables-de-nuestra-situacion-patrimonial\/","title":{"rendered":"Crack or Perfect Storm? Victims or responsible for our wealth situation."},"content":{"rendered":"
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Although this article is dated Tuesday 22 January 2008, I can assure you that we wrote it over the weekend. In fact, it has been sitting in the \u00abdrafts\u00bb folder for three days now, and I imagine the Rankia administrators can confirm this. Following the events of this Black Monday (or perhaps Grey Monday, depending on how Tuesday and Wednesday turn out\u2026), we considered updating it. But we believe it is far more revealing to publish it exactly as it was written, with its original photos included. Exactly as it has been sitting in the \u00abdrafts\u00bb folder for three days. So here it is, without any changes, the post we had planned to publish on Tuesday 22 January 2008:<\/p><\/blockquote>\n

\"\"<\/a>In my view, we are not experiencing a crack<\/span> at in the strictest sense<\/span>, but rather a major, widespread crisis that comes as a surprise only to those who are uninformed. A crisis that has existed for many months but which only becomes visible to most people when their stock market investments fall, or when the news reports and amplifies on television the sharp declines in the world\u2019s major equity indices. The sharp sell-off of shares worldwide is nothing more than a reflection of the macroeconomic crisis that has been building up unmistakably for some time. It is one of its many knock-on consequences. <\/div>\n

Against a backdrop of deep mistrust, the outcome has been fairly predictable. It is true that the starting gun was as unexpected as it was unknown: very few (if any) foresaw a couple of years ago that the collateralised debt, hammered into AAA status, would blow up in the faces of every investor on the planet due to suicidal securitisation. That really was a black swan<\/span><\/a>. But since that initial spark, the chain reaction has taken a course that should come as no surprise to anyone living in Disneyland. That is why the current economic situation bears far more resemblance to a Perfect Storm<\/span><\/a> than a Crack<\/span>,<\/a> since this event, by definition, is a sudden occurrence that leaves no room for reaction, whereas the perfect storm is brewing.<\/p>\n

\"\"<\/a>To analyse this development, I think it is worth re-reading articles (both our own and those by others) in the light of the past 8 or 9 months of global financial turbulence and upheaval. We do not in any way claim to possess the gift of prophecy. There are no crystal balls, but there is a certain amount of experience and common sense that sometimes (and only sometimes) helps us take steps in the right direction in anticipation of future events. Most texts stand up very poorly to being reread with the passage of time (try it with your most admired financial authors), and of course our posts are no exception. But when some of our analyses stand up to this re-reading in such a turbulent environment, we feel proud, to say the least. Here are some interesting examples in chronological order:<\/p>\n