Nationalization of Large Banks: The Perception May Affect The Fundamental

Our view:

• Market perception may affect the current fundamentals of large financial companies causing systemic negative-feedback cycle that will be hard to reverse, even by the government. Denials and reality will likely collide. It is truly a matter of when not if.
• Market movement likely will be on the surprising side next week. Additional regulations and mishandling (and misappropriation) of existing approved regulations and capital injection will likely cause more problems and hence, longer recession.
  
• Life is 'contrary to the contrary to the contrary'...when everything is well-known....including the contrarian view since many now know the contrarian argument....it might not work according the original "non-modified" contrarian view.
  
• This means unprepared ones (now seems to be the large-scale investors and companies) are guaranteed to be defrauded by market forces. As usual, forgetting old ways is far more difficult than implementing new ways.
  
• Mastery of both human and capital survival is going to decide true market-beating investment performance for the next decade.
• Dire reality of the current global economy slowly empowers capitalism and socialism to work together. Unfortunately, this trend is not without potholes. These differing forces across the globe will likely disagree on many terms causing even more dire and prolonged economic recession on a scale that could be shocking even to the most bearish market participants.
• If you were once or twice (or more) fooled by the market, don't be fooled again (and again). It does not pay to be contrarian when many are contrarians and vice versa. The current intelligent investors shall be a.) humble not to think that everything will move according to the 'grand' plan, b.) ready to capitalize on unpredictable market forces without disregarding true market forces, c.) patient yet prudent in anayzing situations, d.) have consistently high dose of common-sense (the higher the better), and e.) lucky due to advanced preparation of future outcome. These are all difficult tasks to master....guaranteed.