Ever since the fourth crusade in 1202 lost what then was valued at 86,000 silver marks that in today’s dollar value is an estimated $41 million, the world has been experiencing financial collapses of unimaginable magnitudes. Let’s fast forward 805 years and several trillion dollars to 2008 when three weeks across the year began an economic earthquake that not only threw the world into financial chaos but also triggered a wormhole that swallowed whole companies such as the Lehman Brothers.
Now after witnessing the ‘dot com’ bubble and the ‘housing bubble‘ investors are utterly and hopelessly lost for ideas and capital. Quantitative easing and credit easing in accordance with near to 0% interest rates have failed to bring about a mass stimulation of the market and overwhelming inflation in the BRIC economies has thrown into jeopardy their long term goals. The SEC’s witch hunt has somewhat only antagonized big investment firms, who still continue to carry out annihilation practices such as “big shorts” in addition to selling bad debt to innocent people.
So what does this leave us with? Rising price of living, stagnating wages and a continuity in the notion that while the rich get richer the poor get poorer. Yes, those with the numbers will say that the middle class has substantially grown in the past decade; however, so has the number of mouths to feed and the price of feeding those mouths. So, in all actuality, the middle class has faced a further dichotomy, with a clear upper middle and lower middle being visible.
Furthermore, the end of the 1st quarter will see the maturing of many bonds that nations such as those in the Middle East claim they will make good on. If they don’t, then in addition to the teetering EU economies, the global financial markets will have to once again pay out in droves in order to avoid a global obliteration.
Maybe then it is time for us to hit back at the bleak forecast by rising above the dark clouds.
Maybe it is time for us to adopt a rudimentary stance and rather famous gambling technique of ‘all in.’ The formation of the gargantuan wall street was on the back of a bullish approach where money was thrown wildly and speedily in order to make even more money, and in order to stimulate an addictive cycle of the multiplier and accelerator effects.
In addition to a more bullish approach, perhaps it is time to empower those who keep a trained and watchful eye over the books of all firms; the auditors. It is time to answer the question ‘quis custodiet ipsos custodiet?’ (who will guard the guardians).
For internal auditors, the issues are often blatant yet they have to avoid biting the hand that feeds them and instead present a face that suggests all is well. Moreover, investigating the suspicious activities of those senior to them without being protected themselves is something no auditor in his right mind will do, especially in a market that seems hell-bent on rendering more people unemployed. Perhaps internal auditors should be allowed to directly report their findings to the SEC and if they are acting on instincts or hunches then there should be a sub committee under the SEC that will sanction further investigation.
The time has come to stop thinking about short term survival and instead to focus on long term revival. The world will not end with us, we should stop trying to ensure otherwise. So invest and invest well.