There is an old saying, “Fool me once, shame on thee, fool me twice, shame on me.” We’ve said it was a mistake to assume that sovereign wealth funds would continue to write checks uncomplainingly to salvage our troubled financial institutions. They’ve already been through one round of fundraising and things are getting worse, not […]
Read more...While the markets anticipate more aggressive cuts in target Fed funds rates soon, the central bank’s task is complicated considerably by rising inflationary pressures. A Wall Street Journal story says that remarks Fed officials show worry that monetary policy may become too expansive: Federal Reserve officials are acknowledging increasing weakness in the economy, signaling a […]
Read more...While one data point does not constitute a trend, a first page article in today’s New York Times, “Creators of Credit Crisis Revel in Las Vegas,” may signal a shift in popular sentiment. Normally, “how the mighty are fallen” stories are exercises in shadenfreude. But this one, on the annual convention of the American Securitization […]
Read more...Bill Gross, founder of bond investing giant Pimco, has almost no kind words for the bond insurance industry in a comment in the Financial Times, “Rescuing monolines is not a long-term solution.” He views a salvage operation for the industry as at best a stopgap to prevent a crisis in the so-called shadow banking system. […]
Read more...The Chinese aren’t alone in their dim view of globalization. In fact, a BBC poll (hat tip Dani Rodrik) found that a higher proportion of Chinese are unhappy about the pace of globalization than Americans. One of the nations least pleased with the speed of integration is Australia, another big beneficiary via a commodities boom.
Read more...Australia releases whaling photos BBC. Australia has caused a diplomatic row with Japan by releasing photos that show that its claims that its whale killing is for “scientific research” is a “charade.” Good for them. Sentiment Signs Says US$ Will Rally Mish’s Global Economic Trend Analysis To Catch a Country CFO.com What happens if a […]
Read more...Deutsche Bank’s CEO Josef Ackermann issued a stark warning today: bond insurer downgrades would have catastrophic consequences, on par with the subprime crisis. Note tha this view is in contrast with teh comparatively sanguine readings that have been coming from some US analysts and the US media, which now appears to regard teh increasing possibility […]
Read more...Readers may have noticed that this site has gotten what one can most politely call visually busy. I’m not happy with the awkward adolescent ad-cluttered look. That in turn leads to a broader discussion of aesthetics, not just in terms of appearance but also positioning. The visual issue is pretty obvious: I’d like this to […]
Read more...Standard & Poor’s is to announce some measures today in an effort to bolster its damaged reputation. These moves seem a bit late in coming, given the firestorm of well-deserved criticism aimed at rating agencies. Indeed, the timing is a bit sus, as they would say in Australia, coming only as international regulators are considering […]
Read more...The Wall Street Journal today says that even if the efforts to raise new funding for the troubled bond insurers are successful, they are unlikely to stave off a ratings downgrade. This story, based in part on reports coming from the rescue discussions led by New York state insurance superintendent Eric Dinallo, indicates that the […]
Read more...Once in a while, separate thinkers reach strikingly similar conclusion. It gets even more interesting when their observations come to light in a compressed timeframe. Yesterday, Willem Buiter pointed out a major difference in perspective between US and foreign economists. Americans are wedded to the idea of doing whatever it takes to forestall a recession, […]
Read more...Credit Crisis: Where Was the SEC? Forbes (hat tip Michael Panzner) PE-backed bankruptcies The Deal Wealthy stressed by rocky economy Investment News New Century, Lawyers Face Claims They Lied in 5-Year-Old Suit Bloomberg ISM Nonmanufacturing index James Hamilton, Econbrowser This is off topic, but in times like these, we need all the humor we can […]
Read more...Bloomberg and the Telegraph report on a speech made by Warren Buffett in Toronto. He sees the dollar falling over the next decade unless policies change, has harsh words for the financial services industry, and says there is plenty of credit available. The last bit sounds troublingly at odds with facts, until you realize he […]
Read more...While this move by MBIA to increase equity and reserves is hardly adequate to preserve an AAA based on what that rating is supposed to mean, the rating agencies, despite their posturing otherwise, are desperate to avoid downgrading MBIA and Ambac,. This fig leaf may be deemed to be adequate, at least for the next […]
Read more...Funny and too true. Hat tip The Big Picture via reader Doug.
Read more...