The Lloyd's Prayer

Thanks to Richard Ambrose for this adaptation of the Lord's Prayer as spoken by the executives at Goldman Sachs. I found this at Barry Ritholtz's blog "The Big Picture," a site that every business student should bookmark immediately.

THE LLOYD’s Prayer

Our Chairman,
Who Art At Goldman,
Blankfein Be Thy Name.
The Rally’s Come. God’s Work Be Done
On Earth As There’s No Fear Of Correction.
Give Us This Day Our Daily Gains,
And Bankrupt Our Competitors
As You Taught Lehman and Bear Their Lessons.
And Bring Us Not Under Indictment.
For Thine Is The Treasury,
The House And The Senate
Forever and Ever.
Goldman.

Darkness Before the Storm

David Rosenberg, ex-chief economist for Bank of America-Merrill Lynch, has made some dire predictions concerning the economic outlook. He believes that we are headed for an unemployment rate, the exclusive U3, between 12-13%. This would place the U6, consisting of people who have given up looking for work and those who have taken part-time jobs, at around 20%. Compounding this prediction is Edward Harrison's belief - whose "Credit Writedowns" website is considered one of the top financial sites on the Internet - that we are now headed into a real depression.

Harrison's view is that debt is the underlying feature of this downturn, which coincides with Yale economist John Geanakoplos theory of collateral and the lack thereof that led to this global meltdown.

Harrison wrote, "When debt is the real issue underlying an economic downturn, the result is a period of stagnation and short business cycles as we have seen in Japan over the last two decades. This is what a modern-day depression looks like – a series of W’s where uneven economic growth is punctuated by fits of recession. A recession is merely a period of recalibration after businesses get ahead of themselves by overestimating consumption demand and are then forced to cut back by making staff redundant, paring back inventories and cutting capacity."

We all know that the subprime mortgage market in conjunction with pyramidal layers of derivative gambles contributed to this monetary malaise, but it is only the precursor of two more real estate implosions: 1) the prime loans that were made with 'exotic' conditions - these reset next March - and 2) commercial real estate, which is already starting to crumble.

Lest you think that I'm here to incite suicidal thoughts, my motive is quite the contrary; there is money to be made during crises, but the businesses have to be carefully chosen. Here is a list of recession-proof business ideas, and here is a compendium of career choices from which to focus your MBA and skills during bad economic times.


"The Chinese use two brush strokes to write the word 'crisis.' One brush stroke stands for danger; the other for opportunity. In a crisis, be aware of the danger - but recognize the opportunity."

John F. Kennedy, Speech in Indianapolis, April 12, 1959