There are many analysts and commentators in the financial sector. If any of them are more sarcastic then me, I haven't seen them yet.
Wealthy people are increasingly turning to pawn brokers for fast cash. This is great news! Some rich people pride themselves on conspicuous consumption, and now the reverse is equally conspicuous. I don't feel sorry for the Hollywood stars and musicians who pawn their bling. Their agents had every opportunity to hook them up with competent financial planners. Non-celebrities who pawn high-value items probably have something to hide, like a bad credit history that a bank would shun. The companion piece on spoiled rich kids tells me everything I already knew about human nature. People say they want to work hard but rarely do. They say they want their kids to have strong ethics but cave in to their every whim. Our species seems to be hard-wired for hypocrisy. Something in our genes gives us a Dr. Jekyll / Mr. Hyde predisposition to take impulsive action and then rationalize it afterwards. Anyway, maybe wealthy people can pawn their spoiled kids' trinkets next once they run short of bling. The brats don't deserve to inherit any of it anyway so the parents might as well haul it off.
Some Greeks may wish they had expensive stuff to pawn off. Desperate Greeks are illegally chopping trees to get wood for heating. Plenty of Americans will be following suit in a couple of years. Sedentary suburban lives mean Americans' survival skills have atrophied and not everyone owns proper hand tools. How about a government stimulus program to retrain people for careers in urban scavenging? It sure would be good for sales at Home Depot, especially if the funds are programmed into EBT cards. Yeah, I know, it's poor taste to ask people to prep for an obvious contingency.
Bankruptcy is one obvious contingency for the financially strapped. Even bankrupt businesses are forced to pawn themselves. Impatient banks are forcing busted businesses to find buyers ASAP or lose their last remaining lifelines. The hidden context is the strong position of banks as senior creditors thanks to TBTF status. Any subordinate creditor of a troubled company can expect to be pushed around in Chapter 11 thanks to Dodd-Frank.
Senior creditor privileges aren't the only advantages the SIFIs have under captured regulatory regimes. JPMorgan may or may not release its report on how the London whale lost billions, depending of course on how the bank's senior officers feel on a given day. The UK's concern for privacy protection comes pretty late after the disclosure of the names of the Whale, his team members, and the senior executives who did not supervise his trades. Those top dogs are still on the job, minus a few token terminations, and they have learned nothing. Rest assured that business will continue as usual.
Business here at Alfidi Capital will also continue as usual. I've learned a lot from reading about the mistakes of the people above.
