Monday Reading
By Barry Ritholtz - October 12th, 2009, 2:57PM
A quick set for a holiday Monday:
• Foreclosures Grow in Housing Market’s Top Tiers (WSJ)
• Dollar Reaches Breaking Point as Banks Shift Reserves (Bloomberg)
• October Crashes I Have Known But Not Loved (Barrons’s)
• Kass: Four Stages of Market Turning Points (The Street.com)
• Markets Aren’t Everything: Parsing the Economics Nobel (Forbes)
• Computing Stock Data in Real Time (Wolfram)
• TARP deadbeats (Reuters)
• Apple and the Future of Publishing — Part Two (Cringely)
What are you reading ?
October 12th, 2009 at 3:03 pm
Trading Tax Gains Momenum
http://slopeofhope.com/2009/10/trading-tax-gains-momenum.html
October 12th, 2009 at 3:04 pm
big banks?
http://baselinescenario.com/2009/10/12/who-needs-big-banks/
risk adjustment
http://baselinescenario.com/2009/10/12/what-is-risk-adjustment/
make ratings agencies liable?
http://www.finreg21.com/news/pressure-mounts-make-credit-agencies-legally-liable-ratings
employment costs up…just not incomes
http://econompicdata.blogspot.com/2009/10/costs-of-employment-up-just-not-in-wage.html
October 12th, 2009 at 3:09 pm
gray bar hotels?
http://www.guardian.co.uk/business/2009/oct/11/bear-stearns-hedge-funds-fraud-charges
October 12th, 2009 at 3:12 pm
Was the NBC NEWS story which aired yesterday about Wall St. securitizing life insurance policies (like they did with mortgages) old news?
October 12th, 2009 at 3:15 pm
Take that, Mac fanboys:
Snow Leopard guest account bug deletes user data
Reports of a potentially critical Snow Leopard bug that can erase a user’s account data have continued to surface since the operating system’s debut.
Since Mac OS X 10.6 launched in late August, numerous reports online have detailed the issue, which is triggered by logging in and out of a guest account on a Snow Leopard machine. Upon logging back in to their regular account, users will find that it has been wiped of all data.
http://www.appleinsider.com/articles/09/10/12/snow_leopard_guest_account_bug_deletes_user_data.html
October 12th, 2009 at 3:18 pm
@f411: LOL! Time to fade Apple? I’ve been delaying my purchase of an I-Phone for 2 months now, as I start to get buyer’s remorse before I even buy the thing. Am starting lean towards Blackberry again to replace my 2-year old Curve.
October 12th, 2009 at 3:23 pm
Why It’s Time to Retire the 401(k)
TIME — http://www.time.com/time/business/article/0,8599,1929119,00.html
October 12th, 2009 at 3:25 pm
@Mannwich: Heh! I love my Blackberry Tour, but the 8900 had kind of a crappy keyboard.
Wow…I can’t imagine losing my dissertation just because I logged out of my PC! But I do have multiple backups, thankfully! =)
October 12th, 2009 at 3:30 pm
visited Huffington again* saved this for us .. lead headline:
“BusinessWeek: Recession Creating A Lost Generation…Just 46% Of 16-24 Year-Olds Had A Job Last Month…Lowest Since 1948″
http://www.businessweek.com/magazine/content/09_42/b4151032038302.htm
“Bright, eager – and unwanted. While unemployment is ravaging just about every part of the global workforce, the most enduring harm is being done to young people who can’t grab onto the first rung of the career ladder.”
….
“Studies suggest that an extended period of youthful joblessness can significantly depress lifetime income as people get stuck in jobs that are beneath their capabilities, or come to be seen by employers as damaged goods.”
one blogger posted this link:
http://www.jobstench.com
(BR – this blogs layout is my favorite – fyi)
……
an un-named regular might find this one interesting .. billed as (imwords) the 1st jihadist:
“When Parisians seized control of their own city in 1871 and ran it as a democratic commune, Fortune manned the barricades and rallied the crowds. But when the French state recaptured Paris — massacring 25,000 people as it went — he was condemned to death, and fled to Spain”
@
http://www.huffingtonpost.com/johann-hari/the-worlds-first-terroris_b_316893.html
……
* coda – is there a app that tells what a page download eats up in bandwidth bytes? like if we lose net-neutrality Huff seems heavy duty on my late 90s machine
October 12th, 2009 at 3:37 pm
@f411: One of my reasons for hedging on the I-Phone is the lack of a physical keyboard. Anyone have any experience with the new Palm Pre? The keyboard thing may be a non-starter for me with the I-Phone.
October 12th, 2009 at 3:43 pm
“BR – this blogs layout is my favorite – fyi” .. let me re-phrase that .. I rate your current layout way better than Huffs for story reading and prefer this style .. but for knowledge base research threads and ability to get to last visit – jobstenchs
October 12th, 2009 at 3:45 pm
jingle mail….not a new invention at all?
http://blogs.reuters.com/felix-salmon/2009/10/12/jingle-mail-datapoint-of-the-day/
October 12th, 2009 at 3:48 pm
ban banks from cds
http://www.bloomberg.com/apps/news?pid=20601103&sid=a65VXsI.90hs
October 12th, 2009 at 4:15 pm
Manny – stick with the BB – I’ve tried several times to make the switch to an iPhone (we have both here at work) but I’m a heavy email/text user and I can’t get used to typing on them.
October 12th, 2009 at 4:15 pm
The stock market is a not a leading indicator: http://globaleconomicanalysis.blogspot.com/
October 12th, 2009 at 4:43 pm
Greg0658
Thanks for the Johann Hari link, great read.
http://www.telegraph.co.uk/finance/personalfinance/consumertips/household-bills/6284423/Britain-has-worst-quality-of-life-in-Europe-study-says.html
Money isn’t all apparently.
October 12th, 2009 at 5:33 pm
The Randall Forsyth article is typical of a large group of InvestTools™ who are treating this as a typical recession, whereby stocks rise until the “too hot” economy forces up interest rates and crashes the market.
What effing planet have these people been on the last two years? We ain’t overheating, we are COOLING DOWN.
Look out the window, geniuses.
October 12th, 2009 at 5:38 pm
Doug Kass* raises this as a contrary indicator and I tend to agree:
http://online.barrons.com/article/SB125513241806577275.html?mod=BOL_hps_highlight
*LB is not Doug Kass, even though they made the same BOTTOM CALL within minutes of each other in March.
Of course LB only made it once, Dougie did it about seven times ….. smirk. Seriously, Kass is excellent. Respec’
October 12th, 2009 at 5:45 pm
We are going to have what LB calls an “internet” recovery, like this, www, now read Rosie:
http://www.calculatedriskblog.com/2009/10/rosenberg-on-economy-string-of.html
October 12th, 2009 at 5:48 pm
Franklin411,
“Take that, Mac fanboys:
Snow Leopard guest account bug deletes user data”
“Wow…I can’t imagine losing my dissertation just because I logged out of my PC!”
Especially, since such a nasty thing never could have happened with MS Windows; and we all do know that MS operating systems are superior and the safest software on Earth ever. No bugs, deleted data, crashes, viruses, worms etc. Right?
I suppose this is the same bizarre perception of reality that also sees the great economic recovery coming.
rc
October 12th, 2009 at 5:49 pm
Thought this was an interesting post at ZH:
http://www.zerohedge.com/article/why-did-us-sdr-holdings-increase-five-fold-last-week-august
Thanks for the tip, Thor. Think I am going to stick with B-Berry after all. Glad I waited and mulled this one over.
October 12th, 2009 at 5:53 pm
and this one. Anyone in any doubt about the Trash Rally ongoing in equities should check this out:
http://www.zerohedge.com/article/eight-worstbest-stocks-2009
October 12th, 2009 at 5:56 pm
Franky411 loves stocks. Franky411 loves PCs. Franky411 loves nanotechnology. Franky411 loves Nobel Prizes.
Is Franky411 actually Larry Summers?
October 12th, 2009 at 5:59 pm
@leftback: Saw that and very nearly fell off my chair. For anyone to think those gains in some of those companies aren’t ludicrous is….well, ludicrous.
October 12th, 2009 at 6:13 pm
It’s interesting when you look at employment vs. retail sales. Retailers reported much better SSS #’s last week. Today we see Black & Decker raising its outlook on strong numbers and even Pier One, yes, Pier One is raising its outlook. So could it be that the segment of the population (this is not my theory btw) that is the majority of the unemployed, weren’t such a big part of the discretionary consumer picture to begin with?
I tend to think that’s right on the money and why we’re seeing much better numbers even as unemployment rises, albeit at a much, much slower pace.
October 12th, 2009 at 6:14 pm
Denninger on the secession option: http://market-ticker.denninger.net/archives/1505-To-The-States-Should-We-Talk-About-Secession.html
And Denninger asks if the fedgov has already destroyed the social contract with the American citizen: http://market-ticker.denninger.net/archives/1506-More-On-Secession-Did-It-Already-Happen.html
October 12th, 2009 at 6:15 pm
@Wanger: Retailers are surviving (for the TIME being) on heavy markdowns. I get offers in the mail every day from retailers offering “one time only” 25-50% off sales on top of their sales prices in the stores. This will not stop any time soon either. They are retraining the customer to never pay full price again and their customers are doing it. They can only do this for so long until they spiral into oblivion. Ever hear of profit margins?
October 12th, 2009 at 6:22 pm
Mannwich: “Ever hear of profit margins?” Well, yes I have. And what’s remarkable and shoots your theory down is that they’re reporting better margins even while “retraining the customer to never pay full price again”. How do you suppose they’re doing that??
October 12th, 2009 at 6:45 pm
Why were drug companies given a free pass by not allowing Medicare to negotiate prices? To keep R&D in America?
Shipping Drug R&D Abroad
http://pubs.acs.org/cen/coverstory/87/8741cover.html?featured=1
America may need a realistic economic plan:
http://www.niemanwatchdog.org/index.cfm?fuseaction=background.view&backgroundid=00401
But, Deficits need to be paid and if government debt is running the economy and helping Main Street
while Wall Street abandons the USA, then all income needs to be taxed at the same rate (harmonize
capital gains and payroll income rates) and the higher end increased (especially the $100 million dollar range which would have been zero without TARP).
October 12th, 2009 at 6:48 pm
@Wanger: Accounting sleight of hand?
October 12th, 2009 at 6:49 pm
@Wanger: And by the way, my wife works in retail, so I have a trustworthy source right here at home that all is not well (as you claim) on the retail front. “Better than expected?” Perhaps, but that doesn’t mean all is well.
October 12th, 2009 at 7:59 pm
High end foreclosures…There have been a number of articles written how sophisticated homeowners are walking away fro deep underwater homes, jinglemail for the rich & famous.If walkaways become socially acceptable (and it seems they’re on their way – especially in non-recourse states) then we’re headed for a RE blowout. This will put the Big Banks on the brink again – but thats just another passthru to the taxpayers
October 12th, 2009 at 8:23 pm
@Manny-
i really like my i-phone
it is more like a mini-highly portable ‘puter
i have not used BB, and Thor has pudgy fingers
October 12th, 2009 at 8:26 pm
jc-
we are in the calm before the storm wrt RE
suspend mark-to-market, extend calm
until not
October 12th, 2009 at 8:27 pm
Cap and Trade come to the US….greener, maybe…but there can be consequences…see anything in the tea leaves here?
http://www.telegraph.co.uk/finance/personalfinance/consumertips/household-bills/6284423/Britain-has-worst-quality-of-life-in-Europe-study-says.html
Britain has worst quality of life in Europe, study says
“Ann Robinson, Director of Consumer Policy at uSwitch, said: “There is more to good living than money and this report shows why so many Brits are giving up on the UK and heading to France and Spain.
“We earn substantially more than our European neighbours, but this level of income is needed just to keep a roof over our heads, food on the table and our homes warm. It’s giving us a decent standard of living, but it’s not helping us achieve the quality of life that people in other countries enjoy.”
October 12th, 2009 at 8:37 pm
Thanks Wes. I’m really torn about it. Maybe I’ll just do nothing until my current B-berry craps out entirely (getting close). It’s a REALLY serious issue, as you can tell.
October 12th, 2009 at 8:39 pm
Wes – HAH! I do have large hands though, should have prefaced my suggestion with that
October 12th, 2009 at 8:44 pm
White House targets Fox as it goes after press critics
http://www.google.com/hostednews/afp/article/ALeqM5hP5X0qPf0d7hibqUqb8f3d2xxlHA
October 12th, 2009 at 8:44 pm
all is well per GS…and quit blaming them for every thing
http://dealbreaker.com/2009/10/goldman-economist-calls-for-mo.php
October 13th, 2009 at 1:25 am
woocoodanode?
“Candor about taxes is rare in Washington, so when House Speaker Nancy Pelosi admits that Democrats may have to impose a huge new tax on the middle class to fund their spending ambitions, believe her.
Speaking with PBS’s Charlie Rose on Monday, Mrs. Pelosi mused publicly about the rising possibility of enacting a value-added tax, or VAT, as part of broader tax reform. “Somewhere along the way, a value-added tax plays into this,” she said. “Of course, we want to take down the health-care cost, that’s one part of it. But in the scheme of things, I think it’s fair to look at a value-added tax as well.”
The allure of a VAT for politicians is that it applies to every level of production or service, rakes in piles of money, and is largely hidden from those who ultimately pay it—namely, consumers…”
http://online.wsj.com/article_email/SB10001424052748703298004574457512007010416-lMyQjAxMDA5MDEwMjExNDIyWj.html
~~
Footnotes:
[1] The 31-Year-Old in Charge of Dismantling G.M. by David E. Sanger, The New York Times: May 31, 2009
[2] We don’t want your tired, poor, huddled masses yearning to trash the planet:
The Federal Reserve, 2009 by Robert Singer
[3] Why Joseph Biden will be the Next Vice President of the United States by Robert Singer
[4] October Crashes, Black Monday 10/28/1929, Black Monday 10/18/1987, Soviet Union Black Friday 10/18/1991 and Black Tuesday 10/29/2008
http://www.daily.pk/the-september-employment-rate-is-90-11826/
October 13th, 2009 at 10:49 am
MEH.
I could see this one coming from a mile, I kept telling my Obama loving surroundings but they think I’m a crazy non partisan weirdo.
October 13th, 2009 at 11:35 am
I’m reading ‘The Pullout Method: Bernanke Claims He Will Be First to Tighten in Heat of the Moment’ at Wall St. Cheat Sheet: http://wallstcheatsheet.com/breaking-news/the-pullout-method-bernanke-claims-hell-be-first-to-tighten-in-heat-of-the-moment/?p=2476/
October 13th, 2009 at 7:42 pm
Reading This:
Memo to Investigators: Dig Deep
By William Greider
Congress instructed the Angelides commission to examine lopsided financial flows in the global economy and the global imbalance of savings.] How did China wind up with a mountain of surplus capital while the US economy has had to borrow more heavily from abroad each year just to stay afloat? One obvious explanation is the unbalanced trading system in which the United States has been steadily weakened by serving as “buyer of last resort” for other nations’ exports. During the past two decades, the United States piled up something like $15 trillion in debt from trade deficits, as value-added production and jobs were relocated overseas. Simply put, we import a lot more than we export, goods we buy from abroad that used to be manufactured in the United States.
Political debate usually avoids the links between negative US trade and our weakened condition as a debtor nation, but the consequences are visible through several channels. The out-migration of production and jobs drives the long-running stagnation of industrial wages, roughly stuck at the same level as in 1973. The annual trade deficits, recently as high as 6 percent of GDP, subtract directly from domestic economic growth. These ill effects and others have created a permanent shortfall in aggregate demand–not enough consumers with the money to buy the stuff they need or want. So households rely on borrowing to pay the bills and hang on to their faltering living standards.[/b]
The financial crisis crisply marks an end to that era of false prosperity. The illusion of living well on borrowed money cannot be revived by repairing the banking system. The restoration of prosperity will require wrenching economic changes, including a very different US approach to the global trading system. No one expects the commission to solve the trade problem, of course. But the investigation can restart the debate on more honest terms. Asking deeper questions about the true sources of the calamity is a first step toward developing authentic answers to the nation’s predicament.
http://www.thenation.com/doc/20091026/greider
October 13th, 2009 at 9:32 pm
“…The out-migration of production and jobs drives the long-running stagnation of industrial wages, roughly stuck at the same level as in 1973. The annual trade deficits, recently as high as 6 percent of GDP, subtract directly from domestic economic growth…”
from TakBak, above
“The Trilateral Commission was formed in 1973 by private citizens of Japan, Europe (European Union countries), and North America (United States and Canada) to foster closer cooperation among these core democratic industrialized areas of the world with shared leadership responsibilities in the wider international system. Originally established for three years, our work has been renewed for successive triennia (three-year periods), most recently for a triennium to be completed in 2012.
When the first triennium of the Trilateral Commission was launched in 1973, the most immediate purpose was to draw together—at a time of considerable friction among governments—the highest-level unofficial group possible to look together at the key common problems facing our three areas. At a deeper level, there was a sense that the United States was no longer in such a singular leadership position as it had been in earlier post-World War II years, and that a more shared form of leadership—including Europe and Japan in particular—would be needed for the international system to navigate successfully the major challenges of the coming years.
The “growing interdependence” that so impressed the founders of the Trilateral Commission in the early 1970s has deepened into “globalization.” …”
…
“There are 390 members of the Trilateral Commission today—160 from Europe, 120 from North American, and 110 from Pacific Asia. They are distinguished leaders in business, media, academia, public service (excluding current national government leaders), labor unions, and other non-governmental organizations from the three regions…”
http://www.trilateral.org/about.htm
Probably, the saddest part of this Story is that the ”rank ‘n file” don’t even know that they’ve been sold down yon’, proverbial, River.