fuzzy wuzzy was a bear

Interesting times. Copied chart at right from Calculated Risk, who got it from dshort.com. I'm a big fan of bears (the fuzzy type, not the market type), so I was naturally drawn to the chart. It nicely illustrates where we currently stand relative to past economic downturns. The amazing thing about this recent slide has been the sheer drop off over such a short period of time, something this generation has certainly never experienced. The creepy talk now is about the commercial real estate markets, where cracks are starting to form. A scary development, for sure, because you just know that there was fuzzy math (yes, that's two fuzzies in one posting) involved with a lot of the assumptions on which loans were likely based. Now, with rents dropping and vacancies rising given all the folks getting canned, things do not look rosy. I guess the question becomes whether the CRE loans were as crummy as some of the residential ones. Based on historical behavior of our lenders (and borrowers, too), my money is on everyone having behaved badly. So, if you're of the mind that this bear still has legs, imagine it will be CREs and credit cards (you know it!) that keep bringing the pain. Combined with cash hoarding by my friends and me (still holding out on chair for living room and XBox 360), it should make for rocking '09.

On happier topics, Veiled Reference - you remember her? - is doing well. I don't talk about her too much these days because my keyboard can only take so many tears. It was tough watching We'reinthemoney win that 3yo filly race at Charles Town last month, particularly given the $125k purse and even more so by memory of the 10 length drubbing Veiled gave her when they met back in December of 2007. Am I bitter? Of course. Do I regret picking Sarah Palin to be my running mate? You betcha. I wish I could undo a lot of things, but that's not the way this business works. Anyway, VR is on the mend, chilling for the next month or so before starting back in January. I'll get up to see her one of these weeks and snap some pictures. Last I saw her, she was all grown up, not the gawky girl she was as a 2yo. I'll have to check whether she still has random anxiety attacks. I don't think she was heavily into bank stocks, but you never know with her.