FWD: Roach sees relief

[DICKENS, EDWIN (973)-408-3024]

A solvency crisis means that banks, etc., have liabilities in excess of 
their assets, even on the most optimistic valuations of the latter.  (As 
opposed to a liquidity crisis, where assets are supposed to be greated 
than liabilities, it's just that the assets are temporarily failing to 
generate enough cash inflows to meet payment commitments on the 
liabilities.)  Yes, I'd say we've got the makings of a solvency crisis or, 
to use a different terminology, the makings of a crisis of overproduction. 
Roach wants the Fed to liquify Morgan Stanley's assets.  J. Grant and his 
ilk will blame the Fed for not tightening earlier and eagerly anticipate 
liquidation.  Liquidate labor, liquidate farmers, liquidate real estate 
Treasury Secretary Mellon would say.  I'm sure this list will thoroughly 
debate the issues of revolution versus reform.

Edwin Dickens

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