The time for honoring yourself, Ben Bernanke, will soon be ended

 Ron Paul Stands Tall, The American Financial Oligarchy, The Arrogance of Power, The Bear Facts, The Consequences of Greed, The excellent adventures of Ben Bernanke, The Financial Elite, The Intrusion of UNLAWFUL Authority  No Responses »
Dec 052010
 

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Retiring New Hampshire Senator Judd Gregg, one of the Federal Reserve’s most stalwart Republican supporters, showed up for a meeting at the central bank in November bearing a surprising gift: a box of End the Fed books. As he handed out the 2009 best seller by Representative Ron Paul, a longtime Fed critic, Gregg told the gathering it would be worth reading to see what the other side is plotting.
Fed Lent Early And Often On Easy Terms – Frank Partnoy, Financial Times
America Bails Out a Thankless World – Editorial, Investor’s Business Daily
Ron Paul’s Moment Arrives – Schmidt & Mattingly, Bloomberg BusinessWeek

Posted by Brian Schuettler at 5:55 pm  

Collapse?

 A Shareholder-Not Just a "Stakeholder", A State of Distress, Bond Market, Coup d'etat in America, Creditors Caveat, Deflation-Inflation-Stagflation, The American Financial Oligarchy, The Bear Facts, The Democrats Blew It Again, The Intrusion of UNLAWFUL Authority, The Obama OMG magic factory, The Suffering Poor  No Responses »
Aug 152010
 

Taleb Says Government Bonds to Collapse, Avoid Stocks – Bloomberg

Nassim Nicholas Taleb, who warned that unforeseen events can roil markets in “The Black Swan,” said he is “betting on the collapse of government bonds” and that investors should avoid stocks.

“I’m very pessimistic,” he said at the Discovery Invest Leadership Summit in Johannesburg today. “By staying in cash or hedging against inflation, you won’t regret it in two years.”

Treasuries have rallied amid speculation the global economic recovery is faltering, driving yields on two-year notes to a record low of 0.4892 percent today. The Federal Reserve yesterday reversed plans to exit from monetary stimulus and decided to keep its bond holdings level to support an economic recovery it described as weaker than anticipated. The Standard & Poor’s 500 Index retreated 16 percent between April 23 and July 2, the biggest slump during the bull market.

The financial system is riskier than it was before the 2008 crisis that led the U.S. economy to the worst contraction since the Great Depression, Taleb said.

Posted by Brian Schuettler at 4:35 pm  

Greenspan helps create the problem and then explains it?

 Greenspan is kind of stupid, History of Finance, It Is Nice To Be Part of the Elite!, IT'S ALL ABOUT POWER AND MONEY, Jacksonian Democracy, Monetary Policy - Discussion, Moral Hazard, Obama Bingo, Our phony middle class, Patience is a virtue...Delusion is a vice, Politicians, Ron Paul Stands Tall, TARP fruit loops, The Arrogance of Power, The Bear Facts, The Consequences of Greed, The excellent adventures of Ben Bernanke, The Global Economy, The Importance of Strategic Planning, The Intrusion of UNLAWFUL Authority  No Responses »
Mar 282010
 

Washington’s Blog

Greenspan’s big defense is that the financial crisis was caused by a “once-in-a-century” event.

Forget about the fact that the “once-in-a-century event” couldn’t have happened if Greenspan’s Fed hadn’t:

  • Acted as cheerleader in chief for unregulated use of derivatives at least as far back as 1999 (see this and this)
  • Allowed the giant banks to grow into mega-banks. For example, Citigroup’s former chief executive says that when Citigroup was formed in 1998 out of the merger of banking and insurance giants, Greenspan told him, “I have nothing against size. It doesn’t bother me at all”
  • Preached that a new bubble be blown every time the last one bursts
  • Kept interest rates too low
  • And did alot of other hinky things

More importantly, as Nassim Taleb repeatedly points out, financial experts who don’t plan for rare events are like pilots who don’t know about storms.

There are storms out there, Taleb says, and any pilot who doesn’t know how to deal with storms shouldn’t be flying. Similarly, no one should be in a position of financial leadership if they don’t know about – and plan for – the infrequent event:

Greenspan: The Financial Crisis Was Caused By A ‘Once-In-A-Century’ Event • Taleb: Any Pilot Who Doesn’t Know About Storms Shouldn’t Be In the Cockpit

Posted by Brian Schuettler at 11:27 am  

U.S. Is Riskier Than Euro Zone; So Says CDS Market

 TARP fruit loops, The Bear Facts, The excellent adventures of Ben Bernanke, The Habits of Hedge Funds, USA Is the New Japan  No Responses »
Mar 262010
 

As the folks at Standard Poor’s Valuation and Risk Strategies division noted in a research note Monday, the difference between the spread on U.S. sovereign credit default swaps and an equivalent benchmark for AAA-rated euro-zone sovereigns flipped into positive territory March 12. As U.S. CDS spreads expanded to their widest levels in two years, that cross-region gap blew out to 5.7 basis points last Friday before narrowing to 4.7 Tuesday.


Wider CDS spreads indicate that sellers of insurance against a particular issuer’s default are charging more for it. In effect, the positive U.S.-versus-euro zone spread means investors think the risk of a U.S. default–however remote–is greater than that on euro-denominated sovereign debt.

So much for the view that low inflation and loose monetary policy make for a rosier debt outlook for Treasurys than for the debt of crisis-hit euro-zone sovereigns.

Wall Street Journal

Posted by Brian Schuettler at 7:57 pm  
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