While switching between the NBA and NHL playoff games yesterday a friend of mine asked "Should I buy Citibank?"
Apparently he was under the impression that Citibank still existed as a marketable security. My reply was to tell him that the publicly traded banks had been nationalized and that they were not in the realm of the free market anymore. He looked at me like I was speaking Martian.
I told him that since the Feds were not taking payments on their TARP, they therefore owned the banks now. Since the government has an equity position in a highly complex out of control entity what do you think is going to happen? Think Michael Dukakis as CEO of Amtrak and the billion dollar deficit that ensued.
I told him not to buy treasuries since the Chinese weren't buying them anymore. They have called our credit card limit. It's cash only baby from now on with them. And printing another trillion dollars worth of paper ain't gonna make them too happy when we pay them back in inflated dolares. Speaking of which when was the last time you got a raise? Just curious.
I also told him to put his money into mining stocks and gold funds.
Don't know if he will or not.
