It occurs to me that the mad dash for cash is going to have some significant consequences beyond the credit crunch. Namely inflation.
If people are going to start turning all their assets, devalued or not, to cash, what happens when inflation starts to kick in as it inevitably will? Disaster.
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Hey, stop trading like Jim Cramer sayz.
I'm not an expert on finance by any means but generally selling everything when the price is low strikes me as a bad idea. Well, it's a bad idea if you don't have a ton of money in reserve ready to buy up a bunch of undervalued assets.
What the hell did people think was going to happen? The market was way out of hand and needed a correction.
I was playing around with this a bit today trying to get a feel for where we're at. Plug in some values:
google finance
Inflation calculator
Everyone needs to take a couple deep breaths and have a drink this weekend.
Imagine a house filled with priceless art. The owners are told one day that the world is going to end so they have a big yard sale where everything is priced to move.
Those of us who don't believe the world is going to end can buy up everything for very little money, then sell it right back to the owners once they come out of their bomb shelters for the prices they orinally paid.
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