The Economist – Fannie Mae and Freddie Mac: Unfinished business Can the American mortgage market survive without taxpayer support? THE hefty financial overhaul that Barack Obama signed into law on July 21st (pictured) left behind one big piece of unfinished business. In 2008 Fannie Mae and Freddie Mac, mortally wounded from losses on loans acquired… Continue reading What To Do With Fannie And Freddie
The Economist – Burgernomics: When the chips are down The latest Big Mac index suggests the euro is still overvalued ASK Western policymakers how they intend to squeeze growth from their sluggish economies and most pin their hopes on higher exports. That makes exchange rates an especially sensitive topic. A weaker currency improves the competitiveness… Continue reading The Big Mac Index
The Wall Street Journal – Bond Sale? Don’t Quote Us, Request Credit Firms The nation’s three dominant credit-ratings providers have made an urgent new request of their clients: Please don’t use our credit ratings. he odd plea is emerging as the first consequence of the financial overhaul that is to be signed into law by… Continue reading Rating Agencies
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The Wall Street Journal – Bernanke Prepared to Take New Steps Federal Reserve Chairman Ben Bernanke told Congress he is prepared to take further action to support the economy if the outlook deteriorates, but indicated the Fed’s reluctance to do so, given limited options and questions about the effectiveness of any new measures. Presenting the… Continue reading Bernanke Lays Out The Federal Reserves Options
<Click on chart for larger image> The Wall Street Journal – What If Greece Doesn’t Default? As far as the market is concerned, a Greek government-debt default is pretty much baked in the cake. Greece, the International Monetary Fund, the European Commission and the European Central Bank may refuse to even countenance the D-word. But… Continue reading Greece
Bloomberg.com – ETFs Imperil Commodity Investors When Contango Conspires With Pre-Rolling By the end of 2009, they had a record $277 billion invested in commodity ETFs and other securities linked to raw materials — a 50-fold jump from $5.5 billion a decade earlier, according to Barclays Capital. During that time, Wall Street had transformed the… Continue reading Contango
Bloomberg.com – Joe Mysak: Bond Default Is About Too Much Debt, Too Little Time The last time a state defaulted on its bonds, it took eight years and the federal government’s help to come up with a remedy. When Arkansas defaulted on its bonds in 1933, the politicians and investors talked about the same things… Continue reading Signs Your State Is About To Default
Bloomberg.com – Jonathan Weil: Goldman Sachs Can’t Say It Dodged This F-Bomb While the Securities and Exchange Commission’s fraud lawsuit against Goldman Sachs may be over, the myths about what’s contained in the settlement agreement seem to have taken on a life of their own. There’s been so much misinformation floating around on this subject… Continue reading Goldman
The Financial Times – Sow the seeds of long-term growth The world economy is entering a new phase after the failure of fiscal stimulus to create a sustained recovery in either the US or Europe. In the US, consumers have retrenched, housing starts have crashed and a double-dip recession is possible. In Europe, fiscal retrenchment… Continue reading Austerity vs. Stimulus
<Click on chart for larger image> FT Alphaville (FT Blog) – So, is it really another lost decade for equities? Are we going Japanese? No doubt fed-up with being asked that question in client meetings, Citigroup strategist Robert Buckland has set out to find the answer. He has examined the Japanese bear market, which started… Continue reading Equities Lost Decade