Thursday, November 20, 2008
In this Martenson Report ALERT, I detail the breakdown in the stock charts of several very large banks and insurance companies, relate these breakdowns to their past use of accounting shenanigans (Level III assets) and derivatives, and make the case that we are closer than ever to a financial breakdown. This is only my third alert ever and is warranted by the companies involved and what they signify.
This is a Martenson Report ALERT.
I send alerts extremely infrequently. In fact, this is only the third ever. I send alerts when there is a breaking news item or market development that warrants your immediate attention or action. I am sending this alert because several companies that I had formerly assumed were “too big to be allowed to fail” saw their stock prices take a serious hit today.
If you don’t like charts, then please be sure to skip past them and read the summary.
Today the Dow lost 427 points to close below 8,000 at 7997.28. But that does not come close to telling the real story. Today the financial and insurance stocks took a hit that, frankly, says we are probably about to enter a brand new stage of this crisis.
While we can be certain that pizza boxes are being delivered to late night, ad hoc committees in Washington, DC and NYC as committee members deal with some as yet unannounced crisis, we can only hope that the assembled teams are staffed with competent people who can craft a decent rescue.
As you know, I think that “hope” is a terrible strategy, and that’s one reason why I am sending this alert. The other reason is that I am on heightened alert ot either/both a market crash or a systemic banking crisis that could lead to a bank holiday.
The (formerly) largest bank in the world, Citibank, seems to be headed for bankruptcy, at least if the stock price is any indication, as it lost over 23% today alone.
That is a serious breakdown in the stock price of such a large company. Let me tell you what the first green circle and arrow are indicating. If you are like me, you will be quite surprised by this next part.