Sunday, May 11, 2008

The sky is dark, wings are flapping

Some, like Don Boudreaux of Cafe Hayek, call the doomsters Chicken Little. Well, many Chicken Littles make a Chicken Big, and she's coming home to roost. Or maybe the pessimists are all wrong, and everybody will live happily ever after. At least, everyone who matters.

Karl Denninger notes that in both the US and Japan, there are moves to force full disclosure of the banks' poor-grade assets; Jim in San Marcos reprises some observations of what happens when mutual funds (collective investments) are told by worried investors to "switch to cash" or simply pay out.

Look out for a hole in the henhouse roof, and a cloud of feathers.

1 comment:

Lil Jimmy said...

Well, many Chicken Littles make a Chicken Big...

Yes indeed and memories of runs on funds are not dormant and funds managers have to manage this angst or else it's going down.

I'd agree doom mongers per se are not helping the situation but there is also some writing on the wall which the smart will read and heed.