Oct
31
“Simply put, [the ABX index] terrible performance is not a matter of market psychology but mathematical fact derived from their cascade structure.”
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Oct
31
“All loan processors, underwriters and loan officers have left the business. A customer service operator at the lender said it’s still operating with a “skeleton crew.” ”
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Oct
31
“Brandes Investment Partners said yesterday that it had taken a 7.9 percent stake in Countrywide Financial, becoming its second-largest investor.”
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Oct
31
“We are far from seeing an end to this. People are saying banks have got everything out there but that is foolish.”
In what were already testing times for bosses of some of the world’s biggest banks, the expected departure of Stan O’Neal from Merrill Lynch will have set nerves jangling. via The Independent
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Oct
31
“In a useful free background paper The Great Commercial Paper Meltdown of 2007 Global Insights says the new M-LEC super-fund approach “is fraught with potential risks, especially in view of further downward pressure from the housing market, and associated deflation in the prices of mortgage-backed securities. “”
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Oct
31
And here we thought they were only turn up as far as apartment complex dumpsters in Atlanta (that was for Ameriquest).
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Oct
31
“Home prices in 20 U.S. metropolitan areas slumped in August by the most in at least six years, a private survey showed today.
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Oct
31
“Consumer confidence fell more than forecast in October, a sign Americans are growing concerned about falling home values, rising fuel bills and dimmer job prospects.”
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Oct
31
So far the Weak Dollar policy appears to be working. Generations are required to build global confidence in a currency. However, that confidence can be lost in a matter of a few years and rebuilding it can take decades. The Weak Dollar policy is creating inflation and causing reductions in the exports for US trade partners, especially in Europe. Business confidence in the euro zone is low and falling dramatically as a result. The Fed is relying on a Weak Dollar policy versus on domestic monetary reflation via rate cuts that would ordinarily have occurred at this point in the economic cycle. The ultimate costs of the Weak Dollar policy are yet to be felt. We note that the Fed policy interest rates are a bit of a distraction in terms of system stability; only really relevant for certain aspects of bank liquidity, but this is an interesting discussion nonetheless. And of course, the rates do strongly dictate the value of the dollar and where global arbitrage money flows. But if you want to know what is being done to (attempt to) shore up the banking system, look instead at what is going on with the M-LEC/”super-SIV”, the Fed’s 23A exemptions, and the Federal Home Loan Bank balance sheets.
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Oct
31
“There has been blood flowing on the streets of Cleveland but nobody cared. The only time anyone listened was when blood flowed on the only street that matters in this country, and that’s Wall Street”.
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