I generally share your view on fiat money systems, and probably have not done as extensive a research job on past recessions as you have. But I have studied economic history and the era of the gold standard. Recessions were actually pretty severe. Peter Bernstein makes a decent argument that a fiat system could work better than the gold standard if prudent rules were followed. Of course, that is a big IF.

I’m glad to hear that you will lay out your criteria for which companies can survive the worse. How would design a portfolio of such companies in a way that would reduce dependence on such a specific scenario for outperformance.

Thanks.

-Paul

William — James Cramer. I wrote for RealMoney for four years. He was a lot better before he started Mad Money — now he is totally short cycle. A pity, because he writes some good stuff when he thinks longer term.

Do you think maybe in a future post you could elaborate on what your criteria are for companies that can “survive the worst”?

Thanks

don’t you think there’s a treasury bubble? as faber sez http://www.abc.net.au/lateline/content/2008/s2389900.htm – ‘Treasuries should be trading like junk bonds.’

the US budget deficit/GDP has tripled from 1% to 3% in a year and is about to triple again to 9% next year, cf. http://eh.net/encyclopedia/article/noll.publicdebt – public debt/GDP is as high as any time since WWII…

re: “Significant socialization of the financial system” see delong http://www.businessdayonline.com/analysis/backpage/16794.html