As Wayne Wagner, a market expert, recently stated, “We walk backward into the future, with our minds anchored by the imprinted lessons of the past.” Whether it be monetary policy, the reaction of credit spreads or the link between the US economy with other countries. We are going through a transition and the old ways of looking at the markets.
As John Maynard Keynes put it way back in 1923: “In the long run we are all dead. Economists set themselves too easy, too useless a task if, in tempestuous seasons, they can only tell us that when the storm is long past the ocean is flat again.” The fact that this credit crisis will be over at some time tell us nothing about how we should deal with the markets today.
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