Closer to the gutter than to the stars (??)

Whenever you believe it can not really get worse, you can be quite sure that you are proven wrong. The events on the global stock markets this week are one good example for that wisdom. The meltdown of asset prices is not really something unprecedented, but clearly the scale and even more so the fact that markets globally are affected is quite a while back.

The Asian financial crisis in 1997 and the Russian financial crisis in 1998 and did not manage to trip over global markets, the Swedish real estate crisis in the early 1990ies reshuffled the whole banking industry in Scandinavia, but the rest of the world was marginally shocked and the burst of the internet bubble at the beginning of this century had only limited impact on the industrial and commodity markets which helped us stand up again. The Wall Street Crash in 1929 resulting in the Great Depression seems to be the most suitable comparative event as it also had massive influence on global equity markets, global economies and the personal wealth of the population. The fact that US car maker General Motors (GM), whose share price last night closed down 30% in New York has now the a lower market capitalization (2,8bn USD!) than in 1929 is anecdotal!

The market believes GM is now worth less than 1929. Is he right?

It feels very much like a Black Friday today, the mood in a dungeon can not be worse and most of the people Markus was speaking to were fed up and hoping they would not be working in that industry. Some are thinking already what they could do instead, either because they expecte to be sacked or because they consider withdrawing from the investment arena. This smells very much of capitulation, which is what we need. But whether we are seeing the lows today, we would not want to bet a lot of money on.

No matter whether the G7 meeting over the weekend will come up with a magical solution for the crisis or not one drought will come to an end for sure: Finally this coming weekend the Austrian Basketball season is getting underway again. Tomorrow, Saturday last season's cup-winner Allianz Swans Gmunden take on the 2007/08 champion Raiffeisen Fuerstenfeld Panthers and one weeks later the regular season kicks off. Judging by the transfers, team changes and pre-season performances one can expect a very tight and interesting season as there are five teams which are expected to be able to beat each other: The two above mentioned plus the Kapfenberg Bulls, WBC Kraftwerk Wels and Markus's team, the Oberwart Gunners. On top of that with UBM Arkadia Traiskirchen, kelag Woerthersee Piraten and xion Dukes Klosterneuburg there are three contestants which could easily suprise. With Admiral Sportwetten the league has received a new main sponsor and the fact that Premiere continues to broadcast up to 45 league games live should enable more presence for the sport and help Markus to stay close the the events. The target to see more games of the Oberwart Gunners live should not be difficult as last year he saw only 3 games all season long live in an arena.

Let's go Gunners!

Kerstin & Markus