How did the market conditions of 2008 compare to what we are seeing today and what is the growing risk facing investors?
Announcer: How did the market conditions of 2008 compare to what we are seeing today and what is the growing risk facing investors?
David Wiedemer: In 2008, the problems were not nearly as great. In other words, we had a meltdown in the mortgage industry, which made a meltdown in the housing industry, and what very few people but us actually anticipated was we also had a meltdown in the financial industry. Not good, but what you had is at that point, let us say the Fed had a lot of dry powder, they had never printed much money before. They did print, but nothing like what they were going to do in the next few months. That is a big difference. Next time, what happens is they can't print enough. In other words, when we have the next crisis it's because they've run out of powder. That's a huge difference, because what would happen if in 2008...
Robert Wiedemer: Let me interrupt you.
David Wiedemer: Oh, yes.
Robert Wiedemer: It's not that they run out of powder, as much, because they can always print more money...
David Wiedemer: That's true.
Robert Wiedemer: It's that the powder loses its impact.
David Wiedemer: The powder loses its impact, yeah, and it doesn't work any more. It doesn't go off. So, I think that's a good point. So what it is... yeah, they're printing huge amounts of money at that point, which is devastating the economy, but at the same time it's not helping any more. It's devastating it, because it's causing massive amounts of inflation which are destroying asset values.