Sunday, March 16th, was remarkable: a top five Wall Street financial institution with an 85 year history was purchased for 1/80th its 52 week high and 1/5th the value of its New York real estate. Bear Stearns was literally worthless. Furthermore, the purchase for the meager token amount cancels the need for Bear Stearns to report earnings today. This might have been the first opportunity for the public to see into the exact depths of the credit crisis. So scared were the parties involved at the Fed and at Bear Stearns, that they choose either bankruptcy or a horrendous fire sale to avoid reporting.
Wow.
Anyway, I took the liberty of aggressively shorting the entire equities market by purchasing positions in the following:
- SKF – Short Financial
- DXD – Short the Dow
- SRS – Short Real Estate
- REW – Short Technology
All in all, the decisions seem prudent given the chaos. I am also aggressively shorting the dollar, as discussed here.
Meanwhile, the Google stock price has been collapsing, dropping another 5% today. It looks like it might drop below $400 per share, and the next stop will be $350 by mid next week. We are in for some pain.
