There are these things called "Technicals", unfortunatly they aren't very "Technical", by that I mean that the technicals show the emotion on wall street, which dictates everything. With my advanced math abilities, I can see a "Trend" and can tell when a "Trend" has been broken.
We did break the trend yesterday, but mostly because, I think the big brokers turned off their big trading machines, but today they are back on.
What is going on, you ask. Well there are these things called commercial paper, meaning they are pieces of paper that have value. They are traded among financial institutions instead of cash. So... in the commercial paper are the "sub-prime" loans. Which are loans to people who had unverified credit, of these people 1 in 10 or 2-10 are going into default. because since the value of real estate isn't increasing, that additional value can't be counted on. The appreciating value was assisting people on "Turning Over" the Real Estate and being able to give that "Commercial paper" value.
Now, that commercial paper isn't being trusted, and when one financial institution tries to hand it off, no one will trust it. suspecting that instead of being "Quality Paper" it's one of these sub prime or Alt-A loans. which they don't want to get dumped on them. That no one will trade this commercial paper, means that transactions between financial institutions are almost frozen.
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