Take a look at this post. He's been as right as rain, so if you're not shook up yet, don't read it!
"I told you so.
The entire credit system is all about confidence.
A year ago I started telling you, and everyone else via Market Ticker, they you had to cut the crap and stop allowing people to lie, or you risked confidence being destroyed.
Today, you're finding out what happens when you don't stop the lies on the balance sheets, don't stop the Level 3 crap, and don't stop lying to The American People. You can't say "I'm for a strong dollar" and then make $250 billion more of them available, the exact opposite of encouraging scarcity, which is how you get a strong dollar, and expect people to take you seriously.
You can't say "subprime is contained" and never apologize for being 100% wrong.
You can't say "the banking system is sound" and then have the second largest failure ever recorded in FDIC history happen a short while later, when the balance sheets of these firms were available to everyone - with their warts displayed - for more than a year prior.
You can't tell people "the economy is fundamentally strong" when unemployment rises and the price of oil doubles in the space of less than a year as a direct consequence of your monetary and fiscal policy.
Bluntly: You've now got a run on the equity (if not the deposits) of virtually every regional bank in the nation because nobody believes you any more.
Your attempt to stabilize confidence with Fannie and Freddie has failed because, in short, nobody believes you any more.
WaMu, National City, Wachovia, First Federal, Downey, Colonial. All down 7% or more, with some down twenty percent today, and with most of them down 90% or more in the last year.
Why?
Because nobody believes you, the FDIC, the OTS or OCC any more.
There is one - and only one - way you can stop this.
You must force every financial institution in America to tell the truth.
NOW."
http://market-ticker.denninger.net/archives/515-FLASH-Paulson-Bernanke-YOU-WERE-WARNED.html
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