I wish we had someone as well regarded as the Financial Times’ Martin Wolf giving the same message in the US. Wolf stresses that prosperity built on overpriced homes is illusory. He pans some ideas that are already being road tested in the US, and says attenuating an inevitable fall in prices is unsound. And […]
Read more...The New York Times, in “Workers Get Fewer Hours, Deepening the Downturn,” presents data and anecdote that indicate that low unemployment masks a deteriorating labor market. Some employers are cutting their workers’ hours; the self employed are finding less demand for their services. While this article provides some useful insight into the state of the […]
Read more...I am frequently mystified at what goes on in the markets. I am even more mystified when people who ought to know better make pronouncements that appear to be profoundly counter-factual. Even if they are talking their own book, the high odds of being revealed as bald-faced liars proven wrong ought to make them worry […]
Read more...Consider this example: In 1997, British Petroleum decided to lower its carbon emissions below the 1990 level by 2010. It achieved the goal in 3 years rather than 13 at a cost of $20 million. Oh, and it happened to save $650 million. With that sort of calculus, you’d think that every big corporation would […]
Read more...Paul Krugman, commenting on a Wall Street Journal article that invoked, then tried to dismiss, concerns about resource scarcity, defended Malthus: Malthus was right about the whole of human history up until his own era. Sumerian peasants in the 30th century BC lived on the edge of subsistence; so did French peasants in the 18th […]
Read more...Maps for New Energy Entrepreneurs Springwise. Now you can get maps that show how much wind and sunshine an area is likely to get, allowing for more efficient eco-prospecting. I’m reminded of the adage about who really made money in the gold rush. Fears grow of massive City unemployment Times Online JP Morgan’s Really Weird […]
Read more...As the credit crisis progresses, the estimates of the total damage march relentless upward. Reader Scott passed along a note by Frank Veneroso, Market Strategist for the Global Policy Committee of Allianz Dresdner Asset Management, which gives a top-down and bottoms-up estimate of credit losses. Note that this estimate is based strictly on US consumer […]
Read more...We wrote last year that some states were getting into the “save the homeowner” act. While states and municipalities are in theory in a much better position to implement this sort of program, their efforts as of our last sighting (November) had yielded little in the way of results. Nevertheless, the proponents hoped that the […]
Read more...The Financial Times reports that that $45 trillion figure that most of us have been using for the size of the credit default swaps market is woefully dated. The International Swaps and Derivatives Association will announce today that outstanding contracts now total $62 trillion, up from $34.5 trillion a year ago. Institutional Risk Analytics gives […]
Read more...The Wall Street Journal reports on another sign of how bad the credit crunch has gotten: banks fudging on what they are reporting as their short-term cost of interbank borrowing, out of fear of revealing how stressed they are. So the Libor becomes less useful as a guide. That in turn means that the so-called […]
Read more...Even though the seeming suddenness of the onset of food inflation and shortages has caught many by surprise, this too was predictable. I recall reading a Barrons Roundtable interview some years ago, perhaps around 2000, when Jim Rogers pointed out that China had set a goal for each person in the country to eat one […]
Read more...A page one story in the Wall Street Journal, “Merrill Upped Ante as Boom In Mortgage Bonds Fizzled,” tells the sorry tale of how the brokerage giant did so much damage to itself via a pathological disregard for risk at the very time when the mortgage markets were about to sour. The firm is still […]
Read more...German schoolboy, 13, corrects NASA’s asteroid figures PhysOrg. Oh, and the revised estimate found that the odds of a collision were 100 times higher than the NASA estimate. Graph of Interbank Spreads Suggests Financial Crisis Continues Unabated Jeff Frankels Debt Britain: 600,000 face bankruptcy Times Online Who Speaks for Mortgage “Lenders”? Adam Levitin, Credit Slips […]
Read more...New research presented at a European Geosciences Union conference projects that oceans will rise as much as 5 feet by the end of this century. This forecast is three times hgher than the scenarios used in the Intergovernmental Panel on Climate Change’s report. If it pans out, it will wreak havoc with low-lying countries such […]
Read more...John Dizard, in “Fed plan is spoilt by its backing of hypocrites,” returns to a notion he has brought up in some recent Financial Times articles, namely, that the amount of funds that banks need to rebuild their balance sheets is so large that it cannot be obtained without some form of government sponsorship. Note […]
Read more...