Turmoil puts big takeovers on hold Financial Times No virgins for you News.com.au (hat tip Transterrestrial Musings) Charts for the Big Bounce The Financial Ninja. Note I am an agnostic as regards technical trading. However, (I know one trader who is enormously successful using it, but he also waits until the signals are overwhelming. Regardless, […]
Read more...Roger Ehrenberg’s latest post, “Alternative Asset Managers and Down Market Cycles: What to Expect,” isn’t quite as blunt as my headline above, but it comes pretty close. He at least says that suffering, while common, will not be universal. Cheap funding was important to the success of hedge and LBO funds and its evaporation will […]
Read more...Although Robert Reich is a smart fellow (and I mean that sincerely), like a lot of Beltway types, he isn’t as well versed in the ways of the world of finance as he is in the workings of public policy and opinion. Thus I found his recent post, “The Politics of an Economic Nightmare,” intriguing […]
Read more...A panel of blue chip authorities, including former Treasury Secretary Larry Summers, legendary investor George Soros, and well respected economists such as Stephen Roach and Nouriel Roubini were sharply critical of the stewardship of central banks in recent years, particularly the Fed. We’ve noted before that not all central bankers were asleep at the switch. […]
Read more...Eric Dinallo, the New York Superintendent of Insurance, is trying to orchestrate a rescue of on-the-ropes bond insurers and according to the Financial Times, has approached various unnamed banks for an immediate $5 billion and an ultimate sum which could be as large as $15 billion. Note that the Pershing Square estimate of capital needed […]
Read more...Sentiment has gotten so bad even among CEOs that there is reason to expect a bounce in equities in the not-so-distant future once frayed nerves have calmed a bit, particularly given the report in Bloomberg that Bernanke & Co. are much more sanguine about inflation and therefore are perceived to be ready to make further […]
Read more...After big market upsets there is inevitably much more good material than I can begin to do justice in posts. High Mercury Levels Are Found in Tuna Sushi New York Times Wamu Continues To Take Its Lumps On Appraisal Practices Bank Lawyer’s Blog News Nonsense Cassandra Does Tokyo. Painful Investment Advice Dean Baker How to […]
Read more...A very good article by David Leonhardt in today’s New York Times raises a question that would have been regarded with considerable skepticism as recently as, say, even August, when the perturbations in the debt markets seemed to be the largely the result of the subprime meltdown. That question is whether the Great Moderation, the […]
Read more...The popular image of universities dominated by left-wing, granola-head faculty who endeavor to corrupt youth with political correctness and relentless questioning of authority is hopelessly out of date. In fact, as article by Michael Gould-Wartofsky in the current Nation, “Repress U.” tells us, higher education has become active in not merely discouraging radical thought, but […]
Read more...It wasn’t enough that the Administration’s fiscal stimulus plan announced last Friday was sufficiently off beam so as to precipitate a global stock market rout. The Fed then put its credibility and some of its remaining firepower on the line to try reverse the gap-downward stock market opening with the in-panic-mode pre-session 75 basis point […]
Read more...If you had any doubts that credit market problems were a big part of the equity market panic of this week, a further reminder came this morning. As reported by Reuters, earnings at the Charlotte bank fell 95% due to over $7 billion in writedowns and reserves for losses. Earnings were 5 cents a share, […]
Read more...My only comment on the attempt to alleviate concerns about the statement on the $45 billion credit default swaps market by the International Swaps and Derivatives Association: while the logic of Bill Gross’ $250 billion loss estimate was subject to question, there doesn’t appear to be any analysis supporting what amounts to an assertion by […]
Read more...The Fed accelerated what was its now expected level of rate cut, 75 basis points, from its scheduled January 29 Fed Open Market Committee Meeting to today, putting the target Fed funds rate at 3.5% and the discount window rate at 4%, The prospect of the S&P and Dow opening down appears to have focused […]
Read more...I have a great deal of respect for people who take the time to do real analysis, and Menzie Chinn is one of them. In his current post at Econbrowser, “Why One Percent of GDP? Opportunity Cost Illustrated (Part III),” Menzie looks into where that arbitrary-seeming figure came from. He first goes through the history […]
Read more...A reader provided a link to a post by Institutional Risk Analytics, which in turn cites a merger filing by Bank of America with respect to its plan to acquire Countrywide. The document details what can only be called a scheme by which Bank of America intends to acquire Countrywide (specifically, the FDIC insured entity) […]
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