SeriousBull

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  • Anna Schwartz Doesn't Like Ben Bernanke Either
    Greenspan counciled Congress not to regulate derivates saying that they were just "a tool for banks to offset risk." He also advocated the repeal of the Glass Steagal Act separating lending from investment banking practices. In short he was a lobyist for the banks. Bernanke is now protecting the banks to hide their insolvency (that's the only explaination for them not lending.) As the Fed's charter is to secure the stability of the financial system, Greenspan should be indicted, Bernanke's bias is institutionalized in the Fed's mission. Hopefully the Congress will have the sense to understand what has happened and separate the purse from the regulator.
    Oct 20 21:45 pm |Rating: 0 0 |Link to Comment |View article
  • Credit Default Swaps, Part One: Origins and Implementations
    Look the fact is that at its peak the CDS market was in excess of $62 trillion and today it is at $55 trillion. The magnatude of these credit default contracts is currently a double-digit multiple of the net worth of the world. When you consider the enormity of this leverage and that by definition one side has a loss, you get too big to fail, you get amortized losses, you get governments doing creative Enronesque accounting, and you have the world holding its breath. It will take a couple years to deleverage to a safe level. Meantime, its more of the same. Printing money and rewarding too big to fail because solvency trumps fairness. But yes we need transparency and the soon a CDS's can trade the better.
    Oct 20 21:35 pm |Rating: 0 0 |Link to Comment |View article
  • Here I Go, Criticizing Warren Buffett
    Buffett needs stocks to go up. Berkshire is a 100% invested in businesses many of which are publicly traded as is Berkshire. His confidence in buying into stocks may be self-serving, but his interest, like it or not, are aligned with every long term "buy & hold" investor, every company, the government and every reader who recognizes the severity of this financial crisis.
    Oct 20 21:14 pm |Rating: 0 0 |Link to Comment |View article
  • The 15-Point Plan to End the Credit Crisis
    A credible start deserving of support and debate. The solution needs also to be open to the non-bank, public, free market competitive forces to purchase the non-eligable securities. Also mark to the market accounting and haircuts should be manditory for less than investment grade securities. Finally the Fed should be stripped of its purse and be required to make its case to Treasury to assure accountability and and transparency.
    Sep 26 10:19 am |Rating: 0 0 |Link to Comment |View article
  • Look Who's Upside Down Now
    The Reserve data tell it all. This bailout is for the banks to meet their reserve requirements, for the Fed to recapitalize, and for the FDIC. I agree with you that money supply tells it all and that we can expect further contraction of the US economy. Given the unfortunate circumstance we must pay the price to save the financial system but must also include the yet mentioned cost of bailing out GNMA. Since this aggregate number is a couple trillion dollars the question to debate is if while they're at it everyone shouldn't also be issued a VISA card by the government to pay their debt on time.
    Sep 26 09:54 am |Rating: 0 0 |Link to Comment |View article
  • Is the $700 Billion Really for Bailing Out the Fed?
    I don't think it is necesary to believe in a conspiracy to follow the thread of the position the Fed has put itself into by accepting crap as collateral for real taxpayer money. The Fed needs a bailout and is recharacterizing Treasury's Bailout as one for the banks who should've already have paid the Fed back. The plan is to overpay to give banks capital again in exchange for the securities the Fed needs to give back. I think this accounts for why the original proposal was for no oversight and no court redress when they were found out.
    Sep 25 17:31 pm |Rating: 0 0 |Link to Comment |View article
  • The 'Melt-Up' Rally Continues
    The market is rising on the bet that their is going to be a bailout for mortgages. Barney Frank is readying it as we speak.
    May 07 11:06 am |Rating: 0 0 |Link to Comment |View article
  • Market Insights From Master Minds
    Good article to ponder. Black Swan events do occur and it would certainly not be an unprobable event to see a 12 P/E on the S&P. One must remember we are experiencing the inverse reaction to the multiplier effect of excessive leverage. The better part of prudence is to stay hedged, leave some powder dry, and cut your losses.
    May 01 10:51 am |Rating: 0 0 |Link to Comment |View article
  • The Impending Mortgage Crisis: Part Two
    Unfortunately this is true. What will also impact the US economy is the magnitude of defaulted GNMA loans no government official or politician is willing to talk about. All this means cutting spending and slowing growth. The Fed's actions merely bail out those responsible while little to abate the reality of too much leverage and too much debt.
    May 01 10:33 am |Rating: 0 0 |Link to Comment |View article
  • The Treasury, Fed and Bankers Are Setting the Bull Traps
    You are dead on it that this is no time to go long or stay long. The Fed has little alternative to printing money in direct or indirect ways. They see the enormity of the leverage, the amplitude of derivative risk, and the negative capital reserves in the banking system and are attempting to shunt a financial panic by doing what ever they can to keep the system afloat. It's a sad commentary when public money is used to bail out irresponsible behavior. Sader too that "too big to fail" now encompasses not just Citi but the whole of the financial system.
    Apr 21 10:55 am |Rating: 0 0 |Link to Comment |View article
  • Fed Notes Indicate Economy's Troubles Aren't Over
    You have estimated a decline in housing prices in the range of 25% or $5 trillion in banking write-downs. This is more in line with our analysis portends the immediate need to shore up the Treasury by taking aggressive action to salvage what we can to shelter the US taxpayer from the losses coming, not only from private companies, but from losses to be (one-day) realized at the government mortage agencies like Ginnie Mae. Time is of the essense as banks typically only hold 5% collateral on a home loan so we are agreeing that $100 trillion in capital reserve deposits (5 x 20 mulitple) will vanish.
    Apr 10 10:19 am |Rating: 0 0 |Link to Comment |View article
  • The Real Threat of the Housing Bubble
    Interesting data. It certainly backs up the marketplace reality that there is not yet enough inducement to buy. Also noteworthy is the fact that bank/brokerage capitial reserves are severely strained. Banks only keep 5% on deposit for housing loans so the decline in housing values has significantly diminished their ability to lend. The Fed is obviously helping and praying time will turn things around. The unfortuate case is that this 'help' delays the tipping point being reached as it delays final repricing of mortgage loans that were made based on excessive valuations. I think the Fed's focus to shore up balance sheets and timing bet to fix the problem may prove to be the highway to printing money as a final cure.
    Mar 27 10:40 am |Rating: 0 0 |Link to Comment |View article
  • Reconsidering the Deflation Risk
    Thoughtful article with good perspective ,however I think the Fed has been behind the curve reacting to the financial crisis until just recently. I think the Fed is focused on bank balance sheets and solvency issues first and foremostly doing what is necessary to avert a financial collapse of the credit markets. Certainly the Fed is aware of the long deflation in Japan and of the risk of inflation. But I would not characterize the Fed as focused on either deflation or inflation at the present time.
    Mar 27 09:49 am |Rating: 0 0 |Link to Comment |View article
  • Take a Piece of PowerShares' Emerging Markets Technical Leaders Pie
    Credit Suisse has had the Indonesia Fund (IF) available since 1990. It has outperformed the EEM but has a higher Beta related to its sole focus on one country.
    Mar 24 11:30 am |Rating: 0 0 |Link to Comment |View article
  • International Monetary Fund Head on Europe and Stagflation
    A lot of lip service by a bureaucrat I think and unfortunately the kind of reform needed will be a developed - emerging growth battle resulting in a less than optimum outcome. Indeed we have reached the time to consider whether financial solvency and/or amount of debt should not be considered as regulatory elements in trade and international relations among countries by a world governing body. For example, would a great debtor and/or insolvent nation who must externally finance its massive debt be more inclined to advocate peace, stability, and growth in their international relations or chaos, fear, and instability? For surely the former would drastically increase their debt service and perhaps make it impossible to service their debt? I think you can see that OECD member countries may sharply diverge on agreement to resolve such a matter that undeniably is in their long term common interests but involves punitive actions targeted at those who have more clout.
    Mar 20 09:58 am |Rating: 0 0 |Link to Comment |View article

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