"An economist is an expert who will know tomorrow why the things he predicted yesterday didn't happen today." - Laurence J. Peter (1919 - 1988)
It was strange to see a new banner on the homepage of Merrill Lynch's website (http://www.ml.com) captioned 'OUTLOOK 2009 - What's Next for the Markets & the Economy - Merrill Lynch's annual look at the year ahead offers expert insights and actionable investment ideas to help you manage today's markets and prepare for better times ahead."
Should I call it ridiculous? ML was not able to provide itself with a realistic outlook of its own financial position and risk management efficiency, and it is now trying to predict how the global markets would be in the year ahead. How many people are going to swallow it?
No doubt, ML has now been acquired by Bank of America, but I still feel that the confidence which has been lost would take a lot of time to be rebuilt. The current global situation has further deteriorated the investor confidence and the wounds would take a long time to heal.
All I can believe that this must be exercise to rebuild confidence in the market about the efficiency of research provided by ML and they have been rather more conservative (and at times a bit balanced with a bit of optimism to ensure that the investors keep investing in the market) in their predictions now so that taking refuge at a later point in time would become easier. Moreover, if the conservative outlook of ML somehow works out in the months to come, ML can surely boast of its research efficiency. All of us, however, genuinely hope that ML's pessimistic outlook doesn't turn out to be true!
6 comments:
this one a far more logical and interesting topic... but it would have been better had u elaborated a little bit on the issue... but anyways nice blog to read.. will wait for your another update :)
Yups, you can expect frequent updates! :)
Talking about ML, I couldn't find any of the investment banks who were able to manage its own financial position & risk. ML and Lehman were unfortunate enough not to find Government investment or Investors to save them but they were the ones who showed the world that what could happen if Banks are not saved.
Of course, almost all banks have incurred great losses. But ML and Lehman were exceptionally bad. Citi might be the next in the league.
Citi is now going to be almost a Government owned Bank, so no chance of it being diluted.... ;)
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