We had a story earlier this morning on hard times in the financial services industry, but this merited separate comment. There is no institutional memory on Wall Street. In superheated M&A markets, investment banks start providing bridge loans even though they should know better. Inevitably, the party ends, credit markets back up, and the securities […]
Read more...This week, I’ve used the slowdown in business news as an opportunity to share some things I have come across that affected how I view the world. I can’t recommend strongly enough that you watch the award-winning 2002 BBC documentary, The Century of the Self, by Adam Curtis. The series comes in four segments; we’ve […]
Read more...The Latest Macro and Financial News Strongly Signal Recession Ahead Nouriel Roubini Trouble With Trade Paul Krugman, New York Times. This article is on the same wavelength as a post of ours on trade yesterday. Buffett to Start A Bond Insurer For Cities, States Wall Street Journal. Buffet genius at work again. We’ve pointed out […]
Read more...Goldman’s William Tanona predicts further sizable losses at major brokerage firms, with Citi and Merrill taking particularly large hits. Tanona also expects Citigroup to cut its dividend. From Bloomberg: Citigroup Inc., JPMorgan Chase & Co. and Merrill Lynch & Co. may write down an additional $34 billion in securities linked to the collapse of the […]
Read more...In less than a week, we have had two lame front page stories at the Wall Street Journal that bear a strong resemblance to each other. I am wondering whether this is a function of holiday short-staffing or a new Murdoch template. “Cursory story” is far too kind a description for this paradigm. The current […]
Read more...Harvard economics professor Edward Glaeser reviewed a new book, “Bad Samaritans” by Ha-Joon Chang in the New York Sun (hat tip Mark Thoma). Glaesar focuses on his objections to the book, but nevertheless concedes, Readers who believe in free trade will not find much in Mr. Chang that challenges that belief, but the book is […]
Read more...Yesterday, I took advantage of this (hopefully) quiet week to share some things I have come across that affected how I view the world. I can’t recommend strongly enough that you view the four-part 2002 BBC documentary, The Century of the Self. Creator Adam Curtis said, “This series is about how those in power have […]
Read more...Egypt to Copyright Pyramids AFP. This reads like a hoax, but the story has been picked up by Wired, which points to the obvious enforcement problems. Losing Hand: Lewis’s Stake In Bear Stearns Continues To Grow as the Stock Declines Wall Street Journal Santa Claus Comes to Wall Street Dean Baker TruthOut Dollar May Fall […]
Read more...Ooof, talk about dispelling the illusion that anyone will take care of the aged. There has been ample comment about the need to reform Social Security. However, the real problem on the retirement entitlements front is Meidcare. Paul Krugman and Dean Baker, among others, have pointed out at length that alarming increases forecast for Medicare […]
Read more...The Case-Shiller Index showed further deterioration in the housing market in October, with a fall in all 20 metropolitan areas surveyed. Not surprisingly, the National Association of Realtors paints a sunnier picture. From Bloomberg: Home prices in 20 U.S. metropolitan areas fell in October by the most in at least six years, a private survey […]
Read more...Since this is a slow news week, I thought I’d use the opportunity to pass along some items that had an impact on how I view the world. The first submission, which comes in four parts is a 2002 BBC documentary, The Century of the Self (to call it to the attention of more readers, […]
Read more...Two readers pointed us to very good post by John Hussman that goes through the Fed’s open market desk operations in detail, and then looks at similar work done on the European Central Bank’s activities (including its widely reported $500 billion liquidity injection). He concludes that in fact liquidity, meaning bank reserves plus money in […]
Read more...One reason for fixed income manager BlackRock’s chief Larry Fink to seek the assignment of acting as manager to the recently scuttled SIV rescue plan may have been to generate some good PR. Today’s Wall Street Journal tells us why that might have been of interest. A BlackRock enhanced cash fund has fallen by more […]
Read more...Lawsuits as an Asset Class Felix Salmon Credit Downturn Hits the Malls Wall Street Journal. The commercial real estate contraction picks up speed. Risk Management at Morgan Stanley An Overview Tom Daula. Morgan Stanley. Rick Bookstaber posted this tidbit on his website and dryly notes that “things did not work out according to plan.” I […]
Read more...For the record, Menzie Chinn is thoughtful and measured, and had a much less inflammatory heading to his post on the need to prevent “looting” in any regulatory reform that comes out of the subprime train wreck. Chinn uses the term looting in a very specific fashion, using George Akerlof and Paul Roemer’s analysis of […]
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