In another sign that China’s slump is serious enough to evoke crisis responses from the officialdom, banking officials there announced that they were relaxing rules on bank bad debt ratios. The objective is to encourage banks to continue to extend credit to borrowers experiencing short-term difficulties who have viable businesses. The concern, of course, is […]
Read more...The latest edition of Marc Faber’s latest newsletter fell off two separate trucks in my ‘hood, and I thought the most useful bits were Faber’s observations (honed from many years of seeing the world from Asia) that just because a market has gone down a ton doesn’t mean it can’t go down a great deal […]
Read more...Junk bond yields were recently as high as 20% (they’ve improved a bit recently). Some commentators considered the record spreads to be overdone. I don’t have a point of view as to whether a particular junk bond interest level is cheap or dear, but I have commented from time to time that there was good […]
Read more...The Wall Street Journal issued a story that appeared to rely on a single source “a person familiar with the data said” and Bloomberg, apparently unable to corroborate the leak, repeated key bits of the Journal article, with attribution. The highlights: Chinese exports fell an additional 2.8% in December versus the prior December, while imports […]
Read more...No, the headline above is not goofy, and I presume it did get your attention. In a concise and suitably critical piece, Floyd Norris of the New York Times tells us that the corporate dividends paid in the seemingly good years depended far more on bank largess than was widely realized. And as credit is […]
Read more...Ah, when it rains, it pours, We Americans get news that the US federal deficits are over the trillion mark even before Obama and Congress pull out the checkbook in an effort to buy some prosperity, when we also are told, via the New York Times, that China, our biggest creditor provider, is likely to […]
Read more...Willem Buiter is being proven right even sooner than he probably expected. The CBO provided a simply atrocious (but I imagine not surprising if you are up on such matters) report that the Federal budget deficit will come in just shy of $1.2 trillion, and that before any stimulus related deficits are added in, which […]
Read more...Reader Michael sent a host of updates on China, which might collectively be called, “Lousy China News Wrap.” And I don’t think he was cherry picking The eye-catching one was a coded story on capital flight from China, “China warns of risks from “abnormal” cross-border capital flow,” from Xinhua. The reason that capital is exiting […]
Read more...Although Manhattan real estate is an expected casualty of the financial carnage, it nevertheless serves as a useful, albeit lagging indicator of the depth of distress. Even though residential purchases have fallen over the last year, the price impact (so far) has been muted. That is in part due to the fact that 2007 was […]
Read more...Many readers are not keen about the idea of a fiscal stimulus program (I presume they are of the Austrian view, that taking the pain, no matter how bad, is the better course of action. And your humble blogger believes that stimulus without cleaning up our broken financial system is likely to have blunted impact). […]
Read more...I am a big fan of Willem Buiter, even on those rare occasions when he is wrong. He is unusually blunt for a Serious Economist, and is willing to take on orthodox views and institutions frontally. He has, for instance, been quite critical of the Fed. He created a firestorm at its last conference in […]
Read more...The Wall Street Journal has sent a news alert that says that Obama is mulling a stimulus plan that will rely more heavily on tax cuts than initially envisaged as a way to win needed Republican support. The Journal says tax cuts could be as much as $310 billion, or 40%, of a total package […]
Read more...Although the Fed has resorted to increasingly unconventional approaches for combatting our financial crisis, one it has used that is widely endorsed is the generous provision of liquidity. Luis I. Jácome H. in a VoxEU post, contends that the liberal use of central bank liquidity to stanch crises actually increased instability. One issue that will […]
Read more...This is the sort of post Dean Baker often writes, “New York Times features economists who missed the housing downturn,” although this time, the subject is the outlook for 2009. Now in fairness, the author, Louis Uchitelle, puts in far more caveats than one normally sees in this sort of piece. In fact, it could […]
Read more...Falling fuel prices and penny pinching consumers are not a plus for energy-saving technology, particularly the big ticket variety. And the latest auto sales figures complicate the plans of those who’d push Detroit towards making hybrids as one of the bailout concessions. From the Financial Times: US hybrid petro-electric sales in November shrank 53 per […]
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