A trillion dollars is for most of us an unfathomable amount of money. However, it seems that the IMF sees that large of a write down due to the unfolding credit crisis. For a more detailed account of what happened check out the book:

I haven’t personally read it, but it is on its way.

I remember when this whole crisis started to unfold, the market peaked, write offs ensued, and that leads us to where we are today. The market seems to think there is light at the end of the tunnel, but I have yet to see it. How is there optimism unless it is blind optimism with an estimated $1 trillion dollar in write-downs, which are beginning the showings of moving into Commercial Mortgages, Credit Cards, Credit Default Swaps, and where will it end.

The present “rally” seems to be hope based on bad news. Or perhaps the markets are being manipulated so that the manipulators get out before all hell breaks loose.

I myself am in a someone state of denial. Everything is starting us in the face waiting to explode, but we want to ignore it as long as possible. The situation is similar to the installation of a stop light. Many times a light isn’t installed until numerous accidents occur, and many fatal. If that is where we are today I’m truly frightened.

My present course of action would dictate the following:
1) Have a decent portion of hard cash on hand. — In USD, NZD, ASD, EUR, and CNY
2) Purchase gold, silver, and platinum numismatics (they weren’t confiscated during the last gov’t gold recall due to them being collectors items versus simply a precious metal).
3) Purchase raw materials, but at the moment I wonder if the market is still overbought. I’ve been hoping for a further correction especially with currencies, but I question if that is prudent. What if one day we wake up to learn that the US Government is bankrupt, it recalling gold and making it illegal to own, we now have a dual currency, and feel free to add to this list.