The Labor Department reported today that the consumer price index was unchanged in September and that core CPI (excluding food and energy) fell 0.1%. The markets may take some cheer from the marked reversal in inflationary pressures, but the flip side is that the change points to deflationary forces starting to take hold. From the […]
Read more...Money markets showed a small improvement overseas once again today, again showing that massive central bank interventions are having an effect only around the margin. While overnight lending rates showed a fair bit of movement, rates at the three month level are still elevated, and more important, all signs are that very little in the […]
Read more...Citigroup’s $2.8 billion third-quarter loss came in at only half the expected level, while the Merrill release came in slightly worser than projected. The Citi report comes from the Wall Street Journal: Citigroup Inc. swung to a third-quarter loss — its fourth straight quarter in the red — as it wrote down another $4.4 billion […]
Read more...Ray of hope for the red squirrel BBC Flat-panel TV prices set to dive, analysts say PhysOrg Giant database plan ‘Orwellian’ BBC Hedge Fund Woes: Troubles at Citadel, Highland Charlie Gasparino, CNBC (hat tip reader Dwight) Co-operatives return to Libor lending Financial Times FDIC Chief Raps Rescue for Helping Banks Over Homeowners Wall Street Journal […]
Read more...Not only is the $43 billion number, um, impressive, but recall September was a dreadful month for many funds. Industry experts see more redemptions in the offing. Moreover, London is a bigger hedge fund center than the New York metro area, where the vast majority of hedge funds ply their trade, so the US figures […]
Read more...One of the biggest focuses of worry has been UBS, which is highly levered even by investment banking standards, a major derivatives player, and widely seen as too big for the Swiss government to rescue. The measures announced before the opening of the market in Europe are clearly hopes to put doubts about the Swiss […]
Read more...We have said for some time that the repricing of residential real estate has some way to go. While conditions will vary greatly by market, a number of measures all suggested that nationally, the decline peak to trough would be on the order of 35-40%. That would in turn suggest that we are only a […]
Read more...New York State Attorney General Andrew Cuomo is out to compel AIG to recover bonuses paid to former executives. It’s an interesting ploy. Even if the New York AG were to prevail in establishing that the former officers were overpaid (the legal theory is that the company did not receive sufficient value for services paid), […]
Read more...The bloodbath continues, largely in reaction to the bad economic news reports in the US . From Bloomberg: Asian stocks tumbled, driving Japan’s Nikkei 225 Stock Average down as much as 10 percent, as concern deepened that the global economy is headed for a recession after U.S. retail sales fell…. “Investors are still pricing in […]
Read more...Boy, that was short lived. The massive EU and US rescue efforts to pump equity into banks, the TARP, the increase in the Term Auction Facility (from $150 billion to $900 billion), the Fed offering unlimited dollar swaps to foreign central banks, and those monetary authorities themselves engaging in liquidity operations, appears to have come […]
Read more...John Kay, in “Banks got burned by their own ‘innocent fraud’,” argues that banks got themselves and the world at large in a heap of trouble via self delusion. Had the bets embodied in their products been presented in simpler terms, they would have recognized that they were bogus and bound to lose money. But […]
Read more...Internet use ‘good for the brain’ BBC Voter suppression in Nevada Guardian (hat tip Ed Harrison) The banker who wouldn’t say sorry Independent. This seems to be an occupational affliction. Interview with Marc Faber Australian Broadcast Corporation. Among the highlights: Treasuries should be trading like junk bonds. Effort to halt financial crisis costs governments two […]
Read more...Since the TARP has a very big checkbook and a very broad mandate (it can buy any kind of dud loan it chooses to, plus bona fide assets), it has become a magnet for industries that have belatedly recognized that it could provide a handout. The latest is the poster child for rust-belt hardship, the […]
Read more...Per Bloomberg, Treasury operatives have admitted, despite Henry Paulson’s protestations to the contrary, that the government can only hope for the best in how the nine banks given a collective $125 billion cash infusion early in the week make use of the loot: Treasury Secretary Henry Paulson persuaded nine major U.S. banks to accept $125 […]
Read more...These statements occur within a mere six paragraphs of each other in a Wall Street Journal story, “Devil Is in Bailout’s Details‘: Upending the government’s relationship with the financial sector, the Bush administration outlined a plan Tuesday to prop up banks by injecting $250 billion into U.S. financial institutions…. The government is making clear it […]
Read more...