Category: Credit Crisis 2008
The analysis published under this category are as follows.
Monday, March 31, 2008
US Interest Rate Cuts Ineffective If Banks Do Not Lend / Economics / Credit Crisis 2008
By: Mick_Phoenix
Welcome to the Weekly Report. Click on the link for my update on Moral Hazard written for Livecharts earlier this week. Stress continues to increase across all markets, a fact that should make all investors stop and think about the root cause.
First up, we dig into the Flow of Funds Accounts of the United States for Q4 '07. Specifically I want to look at the growth of Domestic Non-Financial Debt:
Saturday, March 29, 2008
Tax-payers & Savers: Game for a Laugh? / Politics / Credit Crisis 2008
By: Adrian_Ash
"...We need a continuing message from tax-payers and savers that they will do what it takes to support economic growth..."
JUST BEFORE the staff here at BullionVault start their monthly experiments with the cocktail cabinet, how about a thought experiment to get this party started.
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Friday, March 28, 2008
Bail me out Bernanke / Economics / Credit Crisis 2008
By: Peter_Schiff
Now that the Fed and the Treasury Department have clumsily come to the rescue of the financial titans of Wall Street, it is now politically dangerous to resist similar pleas from just about everybody else. Populism is emerging as a dominant theme is this election year, and with so much largesse showered on Bear Stearns and JP Morgan Chase, politicians are demanding even more generous terms for consumers. In Washington , it seems that two wrongs apparently make a right. Another downside to corporate bailouts is that they provide the critics of free market capitalism with plenty of excuses to weigh down American economic vitality with even more unnecessary regulation.Read full article... Read full article...
Friday, March 28, 2008
Federal Reserve has Begun Buying Mortgage Securities / Interest-Rates / Credit Crisis 2008
By: Ty_Andros
The lighting strike in the markets that I looked for in last week's edition did indeed occur across many sectors. It was a belly button moment for many as Commodities, Currencies, Stocks and Interest Rates were rocked midweek and I was forced look around to make sure that “nothing had changed”. The mainstream financial press was quick to say about the ordeal, for those who place their faith and portfolios in Wall Street's hands, that things were on the mend, the commodities BUBBLE was popped and that the implosion of “paper” investments was on its way to being resolved. New bull markets in paper assets. I have two words for their suppositions: NO WAY and KEEP DREAMING. A new phase of the unfolding BAILOUT of the G7 financial and banking systems began in the last 10 days. Read full article... Read full article...
Tuesday, March 25, 2008
Bernanke's Credit Crisis "Nuclear Option" / Stock-Markets / Credit Crisis 2008
By: Money_and_Markets
Seven days and 12 hours after Fed Chairman Bernanke's history-breaking actions, while financial markets continue to gyrate wildly, market pundits continue to debate madly.
Their incessant question: Why?
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Tuesday, March 25, 2008
Bear Stearns Saga / Stock-Markets / Credit Crisis 2008
By: Regent_Markets
Just when you think a trend has been established, the market throws you a wrench and totally changes the whole picture. Before the markets even opened, the Bear Stearns saga hit its highest note, with JP Morgan offering $2 per share for Bear Stearns, and the latter accepting, mainly because the only other option was Bankruptcy.Read full article... Read full article...
Tuesday, March 25, 2008
Bear Stearns Bailout and My Outrage / Politics / Credit Crisis 2008
By: Fake_Ben
I have been a longtime critic of the Fed, but the latest moves by the Fed are beyond even my most cynical estimations.
Bear Stearns was one of the most aggressive banks in facilitating the excessive lending that helped create the mortgage mess. This mortgage mess is impoverishing millions of Americans and affecting us all through a lower dollar and higher gasoline prices.
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Tuesday, March 25, 2008
New Economic and Financial System to Arise from the Credit Crisis Ashes / Economics / Credit Crisis 2008
By: John_Mauldin
This week I take great pride and pleasure in being able to bring you a recent letter from my very good friend Peter Bernstein. I asked him to let me publish this, as I think this is one of the more important, thought-provoking pieces I have read in a very long time. I am grateful for that permission, as you will be when you read this. I would take the time to read it through several times. Read this paragraph from the beginning of the letter to get an idea of the thought path down which Peter is going to take us: Read full article... Read full article...
Monday, March 24, 2008
The End Of The Financial World As We Know It? / Stock-Markets / Credit Crisis 2008
By: Captain_Hook
The end of the world as we know it is coming. That's right – according to the flamboyantly named Ambrose Evans-Pritchard – where it's likely a challenge just attempting to live up to his name – life as we know it is about to change – big time . And while I in fact agree with this assessment in terms of inevitabilities, at the same time putting this sentiment together with a perceived widening acceptance financials are all toast, it appears time to put on our contrarian's hat again, especially with the business cycle for financials set to turn positive in mere days. This means based on a growing number of pivotal factors (sentiment, cycles, and technicals), and as evidenced by the price action in the market over the past few days, we are growing increasingly skeptical stocks will swoon much further in the immediate future, not before an exhaustion of negative forces set for this month cause a sharp reversal higher. Read full article... Read full article...
Monday, March 24, 2008
Banks Bleeding Value And Hiding Desperation as US Housing Slump Continues / Stock-Markets / Credit Crisis 2008
By: Ronald_R_Cooke
The decline in fixed asset values continues. Homes. Shopping Centers. Commercial and industrial properties. Land. And the decline is not done. Not by a long shot.
Residential Housing
Let's look at the decline in residential housing valuations.
Monday, March 24, 2008
Credit Crisis Burst's the Commodities Bubble / News_Letter / Credit Crisis 2008
By: Nadeem_Walayat
The Commodities bubble burst this week sending gold sharply lower to $908 from above $1020 earlier in the week (11%). The fall in the silver price was even more dramatic - down to $17 from above $21 (20%).
The declines have been attributed to global deleveraging but frankly mark ups of 20%+ in most commodity markets in recent months had pushed the commodities markets into overbought states that require a retracement. However, deleveraging is real.
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Sunday, March 23, 2008
Credit Crisis The Problem The Solution / Interest-Rates / Credit Crisis 2008
By: Fake_Ben
First, we must understand the problem, which is fractional banking. The problem with fractional banking is that cash ALWAYS has to be less valuable than other alternatives. Otherwise, there is an immediate desire to deleverage (to get into cash), and the whole interconnected banking system, with all its counterparty risk, comes crashing down. We are seeing this problem now. Read full article... Read full article...
Saturday, March 22, 2008
Credit Crisis Thoughts- Fed Bear Stearns Action Saved Trillions in Losses / Stock-Markets / Credit Crisis 2008
By: John_Mauldin
- Thoughts on the Continuing Crisis
- Margin Clerks of the World, Unite!
- Where Do We Find New Sources of Credit?
- In Defense of Alan Greenspan
- What Now for Gold, Oil, Etc?
My essay in Outside the Box last Monday seemed to ignite a lot of response in the blogosphere. My basic contention was that the Fed had to act to facilitate the sale of Bear to prevent a meltdown in the markets. Many agreed, but others said Bear should have been left to hang, pointing out that a thorough cleansing is what is needed. Others scoffed at the notion that allowing Bear to fail would have created a massive stock market sell-off. This week we will reexamine that concept, look at the drop in gold and commodities, come to the defense of Alan Greenspan (which should be food for a little more controversy), and think through to the end game of the economic crisis.
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Saturday, March 22, 2008
A Reply to John Mauldin's Outside The Box - Let's Get Real About Bear / Stock-Markets / Credit Crisis 2008
By: Mick_Phoenix
An Occasional Letter From The Collection Agency - I have been, and still am, a long time fan of John Mauldin (JM). I enjoy his take on the bigger picture, even if there are areas I disagree with, from time to time. Generally my disagreements are more to do with the severity of a particular problem or the benefits of a highlight. For instance, JM might allude to a recession but think that it will be mild and happen over a certain time scale, fitting his “muddle through” model. I would agree with the talk of recession but not necessarily the depth, timing or effect. You get the point. Read full article... Read full article...
Saturday, March 22, 2008
Continuation Point for Equities as Credit Markets Continue Deflating / Stock-Markets / Credit Crisis 2008
By: Michael_J_Panzner
For the bulls, the events of the past several days have marked a major turning point for the U.S. equity market.
Share prices staged their first weekly gain in a month. The Federal Reserve pulled out all stops to save the banking system. Financial shares bounced hard. And inflation fears eased as commodity prices fell back to earth.
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Thursday, March 20, 2008
US Alice in Wonderland Monetary Policy / Interest-Rates / Credit Crisis 2008
By: Peter_Schiff
How do you know when you're through the looking glass? A fairly good indication is when the price of gold, which normally moves up in response to monetary easing, instead plummets in reaction to one of the largest rate cuts in Fed history. Apparently, yesterday's 6% drop in gold resulted from the “hawkishness” shown by the Fed in only cutting rates by 75 basis points, rather than the 100 points that many had expected. It is a testament to how low the bar has been set that the Fed can slash rates in the face of a collapsing dollar and soaring commodity prices and still be viewed as hawkish on inflation. Is it just me, or is Ben Bernanke morphing into the Mad Hatter? Read full article... Read full article...
Thursday, March 20, 2008
The Story Behind Bear Stearns- Cliff Notes on Financial Maelstrom / Stock-Markets / Credit Crisis 2008
By: Jim_Willie_CB
As the financial markets stare at the abyss, contemplate the cliff, suffering massive falls in selective stocks, a review of ‘Cliff Notes' might be appropriate. The financial maelstrom is gathering force and fury. The Bear Stearns story has a story behind it, as usual in the Grand Manhattan Den, where violent financial battles give false appearances as desperate measures are played out behind the scenes. The drama on Wall Street will make history. These guys are killing each other, while they cooperate with each other. Like crows, they killed and devoured one of their own. Read full article... Read full article...
Thursday, March 20, 2008
Shadow of the Great Depression and 1970's Stagflation / Economics / Credit Crisis 2008
By: Adrian_Ash
"...Every morning, when you look in the mirror, I want you to think 'What am I going to do today to increase the money supply?'..." John Ehrlichman, assistant to Richard Nixon, apparently speaking to Charles Pardee, a Federal Reserve governor,sometime in the early 1970s
SO WE'RE ALL agreed then.
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Thursday, March 20, 2008
Bear Stearns Bailout Proves US Fed is Merely an Extension of the Financial Industry / Stock-Markets / Credit Crisis 2008
By: Mike_Whitney
One picture tells the whole story. It's a photo of five grim looking men in gray suits staring ahead blankly like they were in the dock with Saddam awaiting sentencing. Every one of them looks downcast and dejected; shoulders rounded and jaws set. This is what desperation looks like, which is why the photo was kept off the front pages of our leading newspapers. Read full article... Read full article...
Wednesday, March 19, 2008
Gold and the Plunge Protection Teams Virtual Garden / Stock-Markets / Credit Crisis 2008
By: Alex_Wallenwein
We all knew the world was ending … and then the Fed and the PPT stepped in and made it all okay again.
Bear Stearns, an 80-year investment banking veteran who saw the crash of 1929 and the Great Depression come and go, who weathered the stormy seas of stagflation during the 1970s and the brutal recession under Volcker and Reagan, disintegrates before our eyes, right into the open pockets of JP Morgan Chase - courtesy of the Federal Reserve (which JPM co-owns)..
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