Category: Credit Crisis 2008
The analysis published under this category are as follows.
Tuesday, September 23, 2008
What Next For the Real Economy? / Economics / Credit Crisis 2008
By: Kurt_Kasun
The Economist Magazine posed this question on the cover of this week's magazine with an illustration of the various pieces of Wall Street machinery being sucked into the vortex of a tornado. The market appears to have stabilized which was the intent of Secretary Paulson in the unprecedented actions he took last week. What comes next for the bailout plan are more goodies from Congress. Why stop at $1 trillion? What comes next for the real economy is going to be the aftermath of this Pyrrhic victory the Fed, SEC, and Treasury jointly scored last week in preventing financial Armageddon. Read full article... Read full article...
Monday, September 22, 2008
Deleveraging Delusions, Denial, and Disorder / Stock-Markets / Credit Crisis 2008
By: Captain_Hook
When first conceptualizing this piece I thought long and hard on an appropriate title. The first one that came to mind was ‘Deer In The Headlights – Desensitized To Risk'. And most certainly, this title does capture the essence of what has happened to the vast majority of the investing population. Through years of propagandized conditioning sponsored by corporate America, its self-serving financial institutions, and the governments they have put in place, the media has been used to desensitized investors to the risks associated with the financial markets, debt (excessive borrowing), and a fiat currency system designed to enslave the unwary. (i.e. and serve the elite.) Read full article... Read full article...
Monday, September 22, 2008
Ponzi Casino Capitalism Discredited- Risk of Global Monetary Crisis / Commodities / Credit Crisis 2008
By: Mark_OByrne
Gold and silver surged last week (up 13% and 15% respectively) as the financial crisis deepened considerably and there was a realisation that the " ponzi " casino capitalism of recent years has critically wounded the U.S. financial system and done serious damage to the global financial system. Gold surged from below $780/oz to close at $861.40 on Friday and has risen again in European trading today to over $882/oz.Read full article... Read full article...
Sunday, September 21, 2008
Historic Week: US Government Avoids Financial Armageddon / Stock-Markets / Credit Crisis 2008
By: Nadeem_Walayat
The financial markets aptly ended a tumultuous week with record busting rallies as Hank Paulson at the US Treasury suspended the FREE MARKET so as to prevent a collapse of the financial system. The two triggering events for the turnaround in stock markets were
a. The SEC banning of short-selling of 799 financial stocks.
b. The US government announcement of the intention to buy up bad bank debt, where the initial outlay will cost the US Tax payer 700 billion.
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Sunday, September 21, 2008
Americans Suckered into Bailing-out Investment Banking Drug-pushers / Stock-Markets / Credit Crisis 2008
By: Alex_Wallenwein
POOF! Ashes to Ashes, Debt to Dust Question: What happens when you destroy a negative? Is that a bad thing, or a good thing?
Answer: It depends on how good of a liar you are. If you can get everybody to believe that the negative is something of positive value, its destruction will be seen as a catastrophe.
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Sunday, September 21, 2008
Credit Crisis Week's Events / Stock-Markets / Credit Crisis 2008
By: Money_and_Markets
Jack Crooks writes: I applaud you if you've made it through this past week with only a few scratches and bumps in your trading account. I know for a fact that plenty of traders got their lunch handed to them.
Thanks to what I call the "visible hand" theory of central banks and the U.S. Treasury, times like these make it even harder to get positioned and stay positioned without being whipsawed.
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Sunday, September 21, 2008
President Paulson's $700 Billion Bailout Plan / Stock-Markets / Credit Crisis 2008
By: Mike_Shedlock
The New York Times has the Text of Draft Proposal for Bailout Plan . Given this is legislation, under fair use terms, here is the complete draft. My thoughts follow.
LEGISLATIVE PROPOSAL FOR TREASURY AUTHORITY
TO PURCHASE MORTGAGE-RELATED ASSETS
Saturday, September 20, 2008
Incompetent Paulson Talks Up Price of Mortgage Backed Securities / Interest-Rates / Credit Crisis 2008
By: Michael_Pento
I hope those who want to sharpen their skills at the art of negotiations are watching Hank Paulson and learning exactly what not to do. Rule number one when entering into a bargaining agreement to purchase an asset is: DO NOT commit to purchasing the asset before negotiating a price. Makes sense, right? Read full article... Read full article...
Saturday, September 20, 2008
The Bailout Plan- What it means for Gold and Treasury Bonds / Commodities / Credit Crisis 2008
By: Clive_Maund
Many investors in the Precious Metals sector are worried that the "bailout plan" announced yesterday will resolve the crisis with the effect that things will return to normal and gold and silver will as a result go into retreat once more. Nothing could be further than the truth. There are several important observations to make regarding the "bailout plan". The first is that it is obviously born out of desperation. Read full article... Read full article...
Saturday, September 20, 2008
The Collapse of Ambac Financial As Moody's Downgrades / Companies / Credit Crisis 2008
By: Mike_Shedlock
In what would have been major news nearly any other week this year, MarketWatch is reporting Ambac warns downgrade would put unit under pressure .
Ambac Financial said late Friday that a downgrade by ratings agency Moody's Investors Service would leave its guaranteed investment contract business short of collateral to meet liabilities.
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Saturday, September 20, 2008
Financial Armageddon and the Re-pricing of Collateralized Debt / Interest-Rates / Credit Crisis 2008
By: John_Mauldin
- Pricing in Financial Armageddon
- Inside a RMBS
- Ratings to Collateral to Ratings: A Vicious Cycle
- This Too Shall Pass
My Dad used to tell me there is no accounting for standards when looking at something that seemed odd. Today, we have faulty standards for accounting that are ripping apart the fabric of the world's economy. How can a security that has a high probability of full repayment be downgraded from AA to junk levels?
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Saturday, September 20, 2008
Congressional Leaders Stunned That Bernanke Finally Admits The Truth / Politics / Credit Crisis 2008
By: Mike_Shedlock
The New York Times is reporting Congressional Leaders Stunned by Warnings It was a room full of pople who rarely hold their tongues. But as the Fed chairman, Ben S. Bernanke, laid out the potentially devastating ramifications of the financial crisis before congressional leaders on Thursday night, there was a stunned silence at first
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Saturday, September 20, 2008
Financial Markets Day of Rest / Stock-Markets / Credit Crisis 2008
By: Doug_Wakefield
“By the seventh day God completed His work which He had done, and He rested on the seventh day from all His work which He had done.” Genesis 2:2
As we head into the third weekend of the month, it looks as though our illustrious financial leaders will once again find no rest this weekend. After working through the weekend of September 5 th , to structure the US government takeover of the two largest holders of mortgages in the world (Fannie & Freddie), they continued over the weekend of September 12 th , deciding that the 158 year old company that is the largest underwriter in municipal bonds (Lehman Brothers) would be allowed to go bankrupt and that one of the world's leading wealth management firms (Merrill Lynch) would be bought out by one of the largest banks in the world (Bank of America), one would have thought that they could have taken some time off. Yet, no rest was found for the weary.
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Saturday, September 20, 2008
Institutional Greed Responsible for Financial Collapse / Companies / Credit Crisis 2008
By: Money_Morning
Keith Fitz-Gerald writes: There's nothing like greed and avarice to bring the entire U.S. financial system to the brink of collapse.
With the demise of Merrill Lynch & Co. Inc. ( MER ), the thundering herd has galloped off the cliff – taking 94 years of history with it. Same, too, with Lehman Brothers Holdings Inc. (OTC: LEHMQ ). Lehman's bankruptcy filing last week caps 158 years of solid history. No doubt they'll be others with American International Group Inc . ( AIG ) spreading the credit-default-swap contagion like a financial Typhoid Mary .
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Saturday, September 20, 2008
US Government Declares WAR on Debt Crisis / Stock-Markets / Credit Crisis 2008
By: Money_and_Markets
Martin D. Weiss writes: In the last few hours of Friday, in a desperate attempt to ward off a catastrophic Wall Street meltdown, the government has announced three unprecedented actions:
First, President Bush, Fed Chairman Bernanke and Treasury Secretary Paulson have called on leaders of both parties in Congress to work through the weekend to develop a plan to let the government buy up bad debts from banks.
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Friday, September 19, 2008
Credit Default Swaps $57 Trillion Risk to Financial's / Stock-Markets / Credit Crisis 2008
By: Money_and_Markets
Mike Larson write: It's been quite the eventful week on the bailout front, eh?
The Treasury and Federal Reserve drew the line at Lehman Brothers, allowing the fourth-largest broker in the U.S. to file for bankruptcy.
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Friday, September 19, 2008
US Taxpayer: A Giant Dumpster For Illiquid Assets / Interest-Rates / Credit Crisis 2008
By: Mike_Shedlock
Paulson, Bernanke, and Congress are conspiring to make the US taxpayer the fall guy for financial stupidity by banks and brokers. Congress is now willing to ram through legislation at the last moment, even though Senate Majority Leader Reid Says "No One Knows What to Do" . Read full article... Read full article...
Friday, September 19, 2008
Potential Economic Fallout From Credit Crisis / Economics / Credit Crisis 2008
By: Joseph_Brusuelas
The events of the past seven days have altered the shape of the market and will impact the economy going forward. The current financial crisis reflects the failure of firms to deleverage in an acceptable period of time. The inability or unwillingness to accept the terms of re-capitalization offered troubled institutions has set in motion the financial train wreck of which we all bear witness. While growth over the past year has exceeded the very low expectations set by the market, the risk to economic output over the remainder of the year is to the downside. Read full article... Read full article...
Friday, September 19, 2008
Time for Selective Buying of Mortgaged Backed Securities? / Interest-Rates / Credit Crisis 2008
By: Andrew_Butter
What's the difference between a TV rating and a bond rating? Answer: The TV rating is audited.
Putting the incompetence of the rating industry in USA and Nadeem Walayat's expression Tulip Backed Securities to one side, my granny always used to say, "Where there's Muck there's Brass"
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Friday, September 19, 2008
US Government’s Financial Disaster Fix-it Plan Sends Stock Markets Soaring / Stock-Markets / Credit Crisis 2008
By: Money_Morning
Jennifer Yousfi, William Patalon III write: U.S. stocks rallied the most in six years yesterday (Thursday) - with traders actually cheering the ticker action from the floor of the New York Stock Exchange - on the news that the federal government is taking steps to shore up the unraveling U.S. financial system and end the global credit crisis. Read full article... Read full article...