Grandpatb,
I'm not sure why you're Red-baiting me, but I'll try to ignore that part of your response.
Actually, I don't think the banks are "insane," if by that notion, you mean they are operating without logic. I'm sure there is a logic to their madness, but I don't claim to know what it is. Maybe "10nisman" can explain. But the simple fact of the matter is, at least here in California (and probably around the country), that there are hundred of thousands of empty homes on the market with thousands of willing qualified buyers (some making all-cash offers), and the banks are unwilling to divest themselves of these properties.
An underrated philosopher of the last century, Lancelot Law Whyte, once wrote that "A pathology in one direction always leads to a pathology in the opposite direction." Perhaps the "pathology" of lending to anyone who could apply for a home loan had led to the "pathology" of not lending to anyone who can actually afford a home loan.
Friends of mine who own small businesses in California confirm what "10nisman" is saying: the demand is there; the banks are not lending. (In the housing market, California's credit unions are banding together to try to get the housing market moving again. I don't know if their successes are having more than a negligible effect on the overall market.)
If the banks do have a logic here, it seems fueled by an intense risk-aversion that seems contrary to their best economic interests. Maybe this is an example of the "animal spirits" at work in the markets on a very large (banking) scale.
To bring this back home a bit to the board, I'm wondering if there isn't a kind of intense risk-aversion taking place in micro and small cap biotech. Perhaps 2010 will bring about a shift in the "animal spirits" in regards to the general Market and to biotech, and, if so, a sharp increase in values might ensue. Let's hope so.
Bladerunner
Bladerunner
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