Lehman took a beating today, with its stock down 13.6% versus its previous close, and 15.2% lower than its offering price (and those trades haven’t even settled yet). The volume was three times the normal level. So much for implications of having an oversubscribed deal. This Google stock chart sadly isn’t as upscale looking as […]
Read more...Do you remember the Ford Pinto? The 1970s car had a nasty tendency to explode into flames in rear end collisions. But the piece de resistance was when litigation exposed a Ford internal memo that showed the company was not only aware of the problem, but had run the math and concluded reinforcing the car […]
Read more...The Financial Times’ John Authers, who called a market turn in bonds in early June of last year, sees another major shift in sentiment on the outlook for inflation and the dollar: For months, through all the volatility of the credit crisis, one bet has been enough to make profits. It is very simple: bet […]
Read more...Dani Rodrik often thinks more like a political economist (which was the initial focus of the dismal science) than the development economist he professes to be, which I consider to be a plus. That perspective enables him to frame issues in ways that sometimes escape other observers. Many discussions about economics often boil down to […]
Read more...Rescue dogs train for Olympics BBC Racing principles’ role in cutting emissions BBC “If you could take 10% off the weight of every car on the planet overnight, it would make so much more difference than all the new engine technologies and fuel technologies that people are talking about”… Please, Mr Obama No Half-Assed Measures […]
Read more...Illustrating the impact that higher fuel prices can have on consumption, the International Energy Agency reported that motor fuel consumption had dropped as much as 20% in Britain. The fall in usage is greater than in other countries, in part due to larger hikes (20% versus 14% on the Continent) and the prevalence of mass […]
Read more...Forgive me if you’ve heard this one before, but a classic Wall Street joke illustrates an important concept. On a slow day in the markets, trader A decided to open bidding on a can of sardines. He offered it at $1. It was snapped up by B at $2, who sold it to C at […]
Read more...Moody’s reports that global junk bond defaults have doubled in the first five months of 2008 compared with their level at year end 2007 and forecasts that the default rate at the end of 2008 will be 5 times the level of year-end 2007. Those rates were 1.0% at year end 2007, rose to 2.0% […]
Read more...The world is finally waking up to the fact that inflation is getting to be a wee bit of a problem and inflation is very unkind to investments. Confidence in China may be fragile, since the stock market reaction seems well out of proportion to the significance of the so-called tightening via a 1% increase […]
Read more...A piece by John Dizard in the Financial Times, “Get used to underwriting big lenders,” made me realize a bit of cognitive blindness. Central banks are committed to backstopping the credit default swaps market. Of course, that should be obvious. The Bank of England, ECB, Fed, and other central banks have intervened in various ways […]
Read more...Dolphins die after mass stranding BBC Is Google making us stupid? Nick Carr, CNet Blogging–It’s Good for You Scientific American. The conclusions seem based on a flawed, indeed romanticized notion of what blogging (at least the most widely read forms, with political as #1, is about). Is Steve Jobs … Gimli? Paul Kedrosky (hat tip […]
Read more...We’ve taken a dim view of plans to use government sponsored enterprises like Freddie Mac and Fannie Mae, and the Federal Housing Administration as vehicles to prop up a housing market that, even with its decline to date, is still overpriced in many areas of the country relative to incomes. Many have spoken in favor […]
Read more...Oil has eased over $2so far today from Friday’s stunning $139 level. As told in Bloomberg, some see it as a reaction to the Saudi argument (consistent with the comments of oil industry executives) that current prices are not warranted by supply and demand, while others see it as a simple pullback: “The increase in […]
Read more...Lehman sold $4 billion of common stock and $2 billion of convertible preferred this morning. The key terms of the convert: The Preferred Stock has a liquidation preference of $1,000 per share, and will pay quarterly cash dividends on a non-cumulative basis, when, as and if declared by the Board of Directors, at a rate […]
Read more...I’m updating this contrary to my usual style, with the latest breaking news update at the top, and you can read the earlier byplay below for entertainment, background, and detail on the fundraising. I suspect there are going to be more Lehman updates today, and I think it’s a bit easier for readers to consolidate […]
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