Doubters And Skeptics, Go Ye Forth And Multiply

At its annual Partners Dinner the late Leon Levy, Senior Partner of Oppenheimer & Company, always welcomed those newly admitted with the words, "You don't know how lucky you are to become an owner of a business in which the higher the price of the product, the more people want to buy it."  We recall those words every day as we encounter the trauma among wealthy investors, whose real estate and stock portfolios have plunged by an aggregate of $14 trillion over the past two years.  That loss has been unparalleled in human history.  This has been a "Rich Man's Recession and Bear Market" unlike all previous post-war contractions.  Of course, a 10% unemployment rate (15% if one counts the discouraged and the underemployed) has exacted considerable pain on the middle class in America.  This is reflected in a jump in the personal savings rate from virtually zero up to a current range of 5%-6% and is likely headed higher as people struggle to whittle down their debt while enduring a torrent of residential mortgage foreclosures.