I approached Jake warily, but he was wagging his tail so I started in:

ME: Jake, how does the market look to you?

JAKE: Chazzerai!

ME: Really, you think this isn’t a good buying opportunity? [I was hoping for a nod, a tail up or down. Jake doesn’t speak English or at least he hasn’t spoken it to me before]

JAKE: Who knows? I’m on the sidelines. If all those FotleyMools are holding, who’s selling? That look like normal diversification and estate planning?

ME: You’re always on the sidelines. You just lie around in the sun, in the shade. In so far as I can tell you don’t do a damn thing?

JAKE: Don’t have to; I have a family takes care of things; I have you. Look, you asked me, I told you. If you want advice from a Dartmouth graduate ask Hank TrustMe, or look in the mirror. Call somebody you went to school with at Harvard. Why are you asking me, I’m a dog?

ME: I’m sorry Jake, I’m not getting anything sensible on the news; those Senators and Congressmen and media talking heads and professors I wrote to with my own plan didn’t answer, well one of them sent an automatic reply thanking me for my interest in his campaign. Look, I’m having trouble hearing you. Dick Foldem is explaining to Congress that what happened to Lehman Brothers was not his fault, something about short sellers. I always thought short sellers were good for a market since they had to cover, eventually

JAKE: Eventually didn’t come this time. Dick Foldem and these other guys were smart at what they did do which was to get paid. Somebody should have been paid to think about Karl Popper and mischievous children and black swans. Perhaps they were cutting back in risk management or the line was busy to India or it’s hard to translate the word ‘swan’ into whatever language they speak there? Only people still reading Proust and one other guy who anticipated this very problem and no doubt cashed big time in the last few days if he went into the commodity market and sold the S&P futures after that ex-Congressman made it illegal to go short one hundred choice overpriced stocks are still concerned with swans. When this is over a lot of people will think about swans, but chances are most will get them wrong. I may not understand them perfectly myself but at least I am one hundred percent in one month Treasuries. Have to roll them over on the sixteenth. What’s today?

ME: Excuse me? Oh, today’s the ninth.


JAKE: Thanks. Look: you couldn’t even email the Presidential Candidates, remember? They don’t want to hear what anybody else thinks; they want to tell you what they have figured out you want to hear and hear what they think from the people they have selected to tell them what they are supposed to think. All the people who gave birth to this forten zoffer are the very ones now being relied upon to solve it. Next we will turn the whole thing over to GreekSpeak, WhatAboutBob and Larry Summerweight. Add NaughtyBill and you would have a very high handicap golf and economics foursome. Sure would hate to play behind them. Then again there will soon be no electricity for the carts although a good many more caddies I expect.

On the news we have watched these so called business journalists genuflect to one pompous idiot after another who is in this drek up to the spread collar on his eight hundred dollar shit. On Friday they asked for a 750 billion dollar blank check. Since then the S&P is down 27% That’s some vote of confidence.

Incidentally, what did you expect sending that mail, those faxes? Senator Silvertongue to show up in a limousine outside; Senator RightStuff to offer you a spot on the economic steering committee next to that Horse…

ME: JAKE!

JAKE: Jake what? Don’t you remember she presided over the total destruction of two perfectly sound companies that had research and development, scientists, workers? What have they got now, CDOs.?

ME: Well, one survived; it is doing really well; too bad I didn’t have some of that.

JAKE: So far. Why not buy some now? Of course the fat lady hasn’t even stretched her vocal chords.

ME: Really?

JAKE: Look: the economy faces what is called a Liquidity Trap. Japan took ten years to emerge from the one it created in much the same way back in 1990. Now we’re not Japan. Maybe we could get out in five years. Do you know how many small businesses we have in America? The Government claims small business represents fifty percent of the economy; suppose only half of them rely on borrowed money? In a Liquidity Trap there is no borrowed money. All these Rescuers can do is buy GotMostlyEverything commercial paper. That way they can pretend GME isn’t broke, avoid triggering more collateral calls. Twenty five percent of the businesses go broke and unemployment will go to thirty forty percent.

ME: That’s ridiculous.

JAKE: What’s ridiculous is that not one single Senator or Congressman understands the first thing about this and yet doesn’t even bother to look at mail from someone who clearly does.

ME: Well, it only makes sense. If unknown derivative exposure makes everyone afraid to lend, expose that exposure, balance off the derivative bets, have the Treasury reinsure it and make the people holding both sides of the bets pay for the insurance.

JAKE: I know; where do you think you got the idea? During our walks.

ME: So, is there any way to rescue RESCUE?

JAKE: Ask these two Candidates to invite suggestions. We only have a month until the election. Tell both of them no one is going to vote until at least one of them reads your proposal and writes a cogent response. At least one of them can read four pages in a month, at least I hope so.

ME: That’s the only strategy you can think of?

JAKE: Unless they nationalize the farcockteh hedge funds, or start printing Papiermarks I think they called them; 1923 was before my time, so, yes, I think so. But don’t forget I’m only a dog. How much GME you got?

ME: 23 shares. I counted them. Your grandfather insisted I get them from that big brokerage firm back in 1982.

JAKE: You still have them? You’ve done very well. Stock went up what, twenty forty times something like that?

ME: I have no idea.

JAKE: Don’t worry then. They still have a long way to fall before you have a loss. At least you have the certificates. Is one side empty? You’ll be able to keep writing. How’s the book by the way?

ME: Finished. I don’t think people want to read about golf though. Not at times like this.

JAKE: Not just about golf any more.

ME: Of course it is; I wrote it.

JAKE: You wrote the first hundred odd pages. Take a look at the rest.


At this point Jake did what he usually does when he gets bored. He went off into a corner, wheeled around and parked his lanky body near the recliner. He never gets tired of Law and Order, but really likes to listen to Hawk and DJ talk baseball. I went to look at the book. It took me a while to read it but when I finished I decided to take my name off the book and put his name on. He doesn’t have a last name but I made one up. As good as the book is, it is very dismissive, scatological, profane, vulgar. You would think Jake spent as much time on Wall Street as I spent dealing with Wall Street, but he didn’t. He’s just a quick study.