Snow leopard wins top photo prize BBC US Army RIP-2 Independent Accountant Less Money, Less Safe Michael Panzner Rescued bank to pay millions in bonuses Guardian Specter of Deflation Lurks as Global Demand Drops New York Times. Dean Baker begs to differ: The Problem Is the Crash of the Housing Bubble: Not Deflation Gedankenexperiment: How […]
Read more...We featured reports earlier this year on plant closings in China, and the suffering in manufacturing areas is becoming more acute as the global downturn cuts into Chinese exports. Reader Michael sent us this report on China’s toymakers, but it also stresses that China may be more vulnerable to a global financial shock than advanced […]
Read more...One of the widely criticized features of Japan’s approach to its post-bubble crisis was that its regulators tried for some time to avoid the recognition of bank losses. In a deflationary environment, it was not clear how this would lead to a better ending, since with a flagging economy and no inflation to reduce the […]
Read more...Investment banks? What investment banks, says the alert reader. They are all gone, either bought by big banks, dead, or forced to become them so as to be able to pull funds from the Federal Reserve more readily. The Financial Times report that the changes to the bankruptcy law in 2005 may have played a […]
Read more...Polar warming ’caused by humans’ BBC Calif. to cut water deliveries to cities, farms AP Drinking alcohol occasionally when pregnant ‘does no harm’ Times Online. Euro wines carry dangerous amounts of heavy metals Wine Economics Sherlock of rock Dalhousie University News Blame the party, not the campaign James Carville, Financial Times. Comes perilously close to […]
Read more...Let’s see, AIG had to ask to be included in the Fed’s new commercial paper program. AIG was reported to have said it needed a wee bit more money, but no more than $10 billion. No reasons were given in any news stories. Now we find out the intended use. From Reuters (hat tip reader […]
Read more...As the economy weakens, a predictable result is an increase in corporate defaults. In the early 1990s, the default rate on high-yield bonds peaked at 12+% (note some define the universe differently and come up with somewhat lower figures) The most recent Standard & Poor’s forecast, while noting a marked deterioration in the economy and […]
Read more...Hauling executives from the private sector before Congress and lambasting them about pay has had zero impact on top level compensation. However, now that the banking industry is a ward of the state and the Democrats might not just win the Presidency but also could get a filibuster-proof majority in the Senate, the banking industry […]
Read more...Before we debate the merits (more accurately, the lack thereof) of the latest trial balloon of a plan being floated to rescue overextended mortgage borrowers, we need to consider a few not sufficiently discussed facts: 1. The problem is that banks are not making loan modifications as they did in the past. That is turn […]
Read more...San Francisco Fed president Janet Yellen is concerned about recent economic data and recommends more action to save homeowners from foreclosure. From Bloomberg (hat tip reader Dwight): Federal Reserve Bank of San Francisco President Janet Yellen said recent data on the U.S. economy is “deeply worrisome” and the government should consider new ways to help […]
Read more...Sabretooth tigers hunted in packs BBC Harvard’s Charlie Neeson raises Constitutional questions in RIAA litigation ZDNet Disgruntled call centre worker ‘froze customer’s bank account in revenge prank’ Telegraph I have had my victories. Just not tonight … Christopher Buckley, Financial Times ‘We’re not going to win this war’ Asia Times A.I.G. Has Used Billions From […]
Read more...Banks have proven to be remarkably immune to condemnation over senior level pay. CEOs and top level producers seem to have an undimmed sense of entitlement, even though the nine banks receiving the first Treasury handouts equity purchases earned a collective $305 billion from 2004 to mid 2007, followed by $323 billion in writedowns. But […]
Read more...This Times Online story is frustratingly vague about the exact nature of these complicated and risky foreign exchange products sold to Japanese retail investors. While the size of the problem ($90 billion) may seem not all that bad in comparison, say, to subprime exposures, recall that these trades are likely to be unwound in a […]
Read more...Commodities had a nice day Wednesday, with oil in particular spiking up. Although the trigger appeared to be the Fed rate cut, one has to wonder at the seemingly disproportionate price reaction, particularly given deteriorating fundamentals and hence falling demand. One reason for the sudden enthusiasm for commodities is that, as in the frenzied days […]
Read more...The agonies of Jefferson County, Alabama, which got itself into a too-clever-by-half funding arrangement that put the county on the verge of bankruptcy, have faded from the public eye. However, the type of transaction that caused so much woe, a swaption to supposedly lower financing costs, has been the subject of SEC and Justice Department […]
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