Good afternoon Hawky Fans,
U.S. volatility spikes:
As the Volatility Index (VIX) reaches a new four-month high, we examine historical data and find a measure of reassurance for buyers-and-holders.
An autumn of discontent?
Several forces have driven the surges of volatility that have ripped through global stock markets. While it could be a bumpy ride ahead, we think the greatest deteriorations in economic conditions and equity markets are likely in the rearview mirror. Full Analysis Here: Global Insight Weekly
And now for something completely indifferent: Jo Biden managed most of his presidential campaign from his basement -- an inspiration to 20-somethings living in their parents’ basements everywhere.
Speaking of discontented students, this election reminds me of my 3rd year accounting professor. As he handed back our mid-term exams, hoping to avoid a messy aftermath (so to speak) he announced: “Please note, these results do not signal the beginning of negotiations.” Whether a sheet ghost or a clown wins the coveted oval office, let’s hope victory brings calm.
True story. About 21 years ago at Smithers RBC we were invited to the local BMO to discuss an impending merger, followed by a joint-staff social. (Say what!?) We thought it was joke, but truth was, the RBC chatterbox was less bubbly than at Baby Blue. In late 1999, RBC chairman, John Cleghorn confirmed that the attempt was “potentially one of the most memorable days in the history of banking.” Gulp.
My first thought was: “What if I lose my job?” We were expecting twins. I knew from school that mergers were motivated by… synergies -- a euphemism for layoffs.
Hmmm… But the two hues of Blues got their withdrawals before their deposits, and should’ve grabbed a Tim’s with Finance Minister Paul Martin first. The Liberals kyboshed the deal, saying our banks were already too concentrated in Canada. More than declined, the bankers were reprimanded, and sternly warned not to so much as fondly glance at each other without asking first. I guess our almost-meeting with BMO in tiny Smithers was a no go. And then like 5-minutes later, TD and Canada Trust merged. Okeedokee.
An oligopoly is a situation where a few firms act in something like a monopolistic way. Free enterprisers dislike both because monoliths are impervious to the market pressures that make shopping and commerce fun. The market becomes a dull, dusty, no-name brand warehouse of dread, and its sole supplier acts like we should be grateful they exist.
On the bright side, there’s actually fierce competition among our banks and credit unions. Nobody can argue we aren’t sometimes a solid, (bordering on stolid), group, but we basically hate each other. Seriously, and we absolutely love to steal another bank’s client, and then do a weird Ed Grimly dance past their door for like a month. And that’s good.
But here’s the thing: If oligopolies are undesirable, and monopolies are downright creepy, it follows that one big huge super monster corporation is the absolute worst. Even if… No – especially if -- that beast is a government. Experiments in socialism-that-mutates-in-to-communism have invariably been dominated by a monolithic government, wracked with creativity-killing lethargy, answerable only a single, ruthless, bloodthirsty political party, morphing in to a murderous monopoly power even before taking office.
So anyways, beware of strangers bearing candy. Have a spooky weekend. Maybe watch some Steven King.