The Economist – College enrolment: Snob nation Surging enrolment may help explain a labour-market puzzle n a recent poll 94% of parents said they expected their children to go to college. And in January almost 60% of Americans aged 16 to 24 were enrolled in one, an all-time high for that month. Enrolment has been… Continue reading Two Views On The Labor Participation Rate
The Financial Times – Cash-hoarding companies seem unable to splash out It is a notorious truth that western companies are hoarding cash. They are not hiring or investing as they should. They are not doing their bit – and cash-strapped governments are getting restive. The official response could take various forms, starting with taxation. Unless,… Continue reading The Myth Of Cash On The Sidelines – An Update
The Financial Times – Greek debt swap triggers massive payouts Billions of dollars are to be paid out in insurance-like instruments as Greece on Friday pressed ahead with the largest ever sovereign debt restructuring. In a test case for markets, the International Swaps and Derivatives Association, the derivatives trade body, announced there would be a… Continue reading Greece: A CDS Credit Event
<Click on chart for larger image> The Wall Street Journal – Jon Hilsenrath: Piecing Together the Job-Picture Puzzle Something about the U.S. economy isn’t adding up. At 8.3%, the unemployment rate has fallen 0.7 percentage point from a year earlier and is down 1.7 percentage points from a peak of 10% in October 2009. Many… Continue reading Looking At Unemployment
The Wall Street Journal – Mortgage Deal Is Built on Tradeoffs Banks won a handful of concessions in the landmark $25 billion settlement of alleged foreclosure abuses, as federal officials struck a balance between their desire to be tough on lenders and the need to provide immediate relief to the housing market. A key sticking… Continue reading Foreclosures
The Financial Times – John Dizard: Battling bondholders could cost a lot No, no, no, not that “Republic”. You were thinking of some European republic, right? His Honour was wielding the verbal bastinado on the Republic of Argentina. However, the judge’s little remarked-upon ruling, on a case brought by bondholders who chose to be holdouts… Continue reading Maybe The Last Word On Greece Has Not Been Said?
The Wall Street Journal – Italy Data Confirm Recession Italy’s economy fell into recession in the final three months of last year, contracting for the second consecutive quarter and strengthening analysts’ views that the negative trend will continue in 2012.The economy shrank 0.7% in the fourth quarter from the previous three months, data from national… Continue reading Italy Is Officially In A Recession
Barron’s – A High Point for High-Yield Prices are high, defaults are low and yields are fat. How long can this last? It’s been a heady time for high-yield bond investors. Their market is up 4.85% already in 2012. The default rate stands at just 2%. Investors have plowed $16.4 billion into junk funds and… Continue reading High Yield Bonds
Barron’s – The Worst of Times to Buy Stocks? A leading fund manager sees conditions in today’s market that presaged past plunges. A “perfect storm” lies ahead, adds a technical guru. When practitioners who take distinctly different approaches to analyzing financial markets come to similar conclusions, it behooves investors to pay attention, even if those… Continue reading Sell Stocks Now?
Bloomberg Businessweek – Fed’s Loan-Loss Outlook in Stress Test May Disappoint Investors Investors may be disappointed by how U.S. banks perform in Federal Reserve stress tests as examiners expect consumer-loan losses to surpass the industry’s estimates if there’s another severe recession, analysts say.The Fed generally has predicted firms would suffer greater losses on mortgages and… Continue reading Surprise! …Stress Tests May Disappoint Investors
The Telegraph (UK) – Global liquidity peak spells trouble for late 2012 Rightly or wrongly, the US Federal Reserve does not intend to do anything about this. Time is running out for Ben Bernanke before the US election season closes the political window on fresh stimulus, yet he gave no hint of largesse in his… Continue reading Global Liquidity
Bloomberg.com – Carmen M. Reinhart:Financial Repression Has Come Back to Stay As they have before in the aftermath of financial crises or wars, governments and central banks are increasingly resorting to a form of “taxation” that helps liquidate the huge overhang of public and private debt and eases the burden of servicing that debt. Such… Continue reading Carmen Reinhart Speaks