Here are the items that I found most intriguing today:

• Yield Curve as Recession Harbinger (WSJ)

• Ports wary of stunted holiday rush  (LA Times)

• Rates Fall as Market Fears Economic Weakness (NYT)

• Can the Nation Stimulate Its Way to Prosperity? (Federal Reserve Bank of Dallas)

• Turbocharged Germany: Their economy is growing by 9%/yr (Economist)

• Mutual Fund Cash Balloons (The Bond Buyer)

• “Was TARP Passed Under Bush or Obama? (Pew Research) Only 34% of Americans can answer that correctly…

• Invasion of the Argentine Ants (Esquire)

• Redesigning the New York City subway map (O’Reilly)

• The World’s Largest Tidal Turbine, Unveiled (Good)

What’s on your browser?

Category: Financial Press

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

20 Responses to “Monday Reads”

  1. call me ahab says:

    I am posting this is only for the headline alone- from ZH-

    10 Year Yield Plunges To 2.57% As Bond Market Goes Full Retard

    laugh my ass off

    remember all of you out there- never go full retard

  2. farmera1 says:

    Systemic risks or how big interconnected, complex systems fail. Or as Buffett might say, derivatives are weapons of mass financial destruction.

    A good read.

  3. constantnormal says:

    Just a tid-bit regarding the “world’s largest” tidal turbine … at 1 MW of power, this is far below the larger wind turbines in operation today, and while the tides are hugely more predictable than the winds, they are only operating a couple of times per day (I think — maritime folks feel free to correct me on this). This fall, AMSC is expected to license their superconducting offshore wind turbine design, a 10 MW unit that is a direct-drive model, omitting the gearbox, which tends to be the highest source of operational maintenance.

    But this is not to belittle tidal energy extraction — we need to be pulling power from every source available …

  4. NoKidding says:

    “Was TARP Passed Under Bush or Obama? (Pew Research) Only 34% of Americans can answer that correctly…

    Not really relevant, as policy has been nearly identical since Paulson gave his $Trillion TV scare speach.

  5. Thor says:

    constant – I think the idea behind tidal energy is to take advantage of the up and down motion of the waves rather than the in and out of the tides. . .

  6. Dogfish says:

    iirc, it is actually for the in and out of the tides.. in some places it’s a lot of energy. thus it being such a large, heavy machine and designed for low rotation. some of those areas in northern uk see 40 ft sea level differences between tides. i could be wrong, this is off the top of my head from reading of years past.

  7. leonardcrook says:

    Wave generated power and tidal power are two different things. The tidal turbine is supposed to take advantage of tidal flow, hence the blades. Wave projects use different methods translates the up down wave motion into something that can generate electricity. Wikipedia has a nice article on wave power. The Federal Energy Regulatory Commission issues permits for hydrokinetic projects that include wave, tidal, and river flow turnbines.

  8. Mike in Nola says:

    ahab: I’m in full retard mode. Seems like the Hedgies must be too. At least I went retard early.

    Our EDV is up 4.37% today and ZROZ is up 4.95% today. Plus a parcel of individual 10-30 year treasuries. It’s almost like owning the double short ETF’s back in the crazy days of 2008. Hurricane Ike had knocked out power and I had to get in the car with my laptop and cell phone as a modem to trade. Hard to believe that all I own is US debt.

    I’m starting to believe the bond bubble rants. I think the 30 year will eventually get below 3%, but it’s going so fast, it seems like there could be a bounce.

  9. Mike in Nola says:

    Amazing that so many people are piling into Municipal Bonds. I guess the don’t read the stories about the states and cities having to furlough or just plain lay off workers and how they are facing pension costs they cannot hope to meet.

  10. jeg3 says:

    “Where has the oil gone?”

    Always best to see what researchers say instead of pundits, because the dissolved oil and dispersants are still toxic. A lot more research is needed without non-disclosure statements, who is the commander in chief of this country?
    “No toxicity studies have been conducted on this product.”

    Who can investors trust?
    “One of the many reasons why I am so opposed to IFRS adoption in the US is that I trust the IASB even less than the FASB to stick to its principles or to focus on the needs of investors. Chicken salad speech GAAP from IFRIC is just one more reason to feel that way.”

    “Fraser Institute 2009/2010 Mining Survey: A Must-Read for Investors”

    A country with Cajones, always nice to see someone give the neoliberals the bird.
    “Hungary’s Defiance of IMF and European Authorities Scares the Guardians of Austerity in Europe”

  11. S Brennan says:

    “Was TARP Passed Under Bush or Obama? (Pew Research) Only 34% of Americans can answer that correctly…”

    Which is perfectly understandable since it’s one of a long string of Bush’s policy that Obama whipped up support for…Obama is Bush’s 3rd term.

  12. MorticiaA says:

    Stop me if you’ve read these before:
    Chart of the day: How long after a recession does it take to get back to normal employment levels?
    To attract future customers, cemeteries throw graveside parties.

  13. “…when I met with Fusion-io a few weeks back, I asked company officials what was at the core of Woz’s interest in them and their products. The story they briefly shared with me is reminiscent of the hardware-versus-software SSD architecture differentiation between Micron and Fusion-io that I talked about in my previous post. And I’ve subsequently been able to confirm its validity thanks to an excerpt from Wozniak’s ‘iWoz’ autobiography, posted on Amazon’s website.

    The tale, in brief, involves Wozniak’s request to accompany Steve Jobs and Mike Markkula to the 1978 Consumer Electronics Show, held less than two years after the company’s incorporation. Woz was told he could go if he figured out how to mate the just-introduced Apple II computer with a floppy drive. CES was in less than two weeks, and Woz was chartered with designing an add-in controller card for the just-introduced Shugart 5-inch format drives. I’ll let you read the full fascinating excerpt, which spans less than 10 pages and includes an inadvertent floppy disk wipe of the source code, on Amazon’s website. But to whet your appetite, here’s a brief quote:

    In the end, I decided that of the twenty-two or so chips, about twenty of them weren’t needed. To make the floppy disk work required a combination of a circuit I had to design and the existing circuit on the Shugart drive. I stripped out twenty of their chips, so that reduced twenty of my total end product. That’s the way I always think about things. I could run data right from my own floppy controller to the read/write head and implement any start/stop protocols of my own in code on the computer. To tell you the truth, it was less work on the computer than generating the funny protocol Shugart wanted.

    In pondering the divergent Micron-vs-Fusion-io approaches earlier today, I drew an analogy to PC audio and its evolution over the years. Not too long ago, in order to achieve a robust audio presentation coming out of your computer (virtual or physical surround sound, high sample rates and large sample sizes, minimal ‘lip sync’ delay, etc) required a beefy standalone DSP. Commensurate with the publication of Intel’s AC’97 standard, however, silicon’s grip on sound began to slip.

    The analog-heavy portions of the audio subsystem split out into a separate codec IC and, beginning with low-end systems, the digital audio processing algorithms ran on the host CPU instead. And as x86 CPUs became increasingly robust, processing delays actually decreased with a software-centric solution, versus the traditional approach of shoving a bunch of code down a slow peripheral bus for subsequent audio co-processor attention. Very few audio add-in cards survived the PCI to PCI Express transition, and nowadays host-based audio processing reigns supreme, lingering dissenters be damned.

    RAID provides another example of the software-vs-hardware tug-of-war. While it’s still relatively common to find hardware-accelerated RAID add-in cards, especially for more complex RAID levels that encompass greater than two HDDs or SSDs, two-drive RAID 0 and 1 are commonly implemented in software either at the BIOS level or within the operating system. Arguably, assuming your system is sufficiently CPU-robust to handle mass storage subsystem administration without discernibly slowing down in other areas, software-based RAID (especially at the O/S level) is the preferable approach. If a hardware RAID controller or motherboard dies and you can’t find a replacement, you’ll never be able to access your drive-based data again. Conversely, with a standardized O/S-based software RAID approach, you never have to worry about hardware failures locking you out from your valuable bits.

    So which approach to flash memory array management, hardware or software, will reign supreme both in the near-term and over time?…”
    background ..
    If demand for EVs doesn’t exceed projections, there could be a lithium-ion battery oversupply, analysts say.
    Charles J. Murray, Senior Technical Editor, Electronics — Design News, 2010-08-16 12:21:00 EDT

    Lithium-ion battery technology may be considered a solution to the struggles of the auto industry in some quarters, but analysts are saying that manufacturers of the batteries may be facing an industry glut five years from now.

    Studies by Lux Research Inc. and Pike Research indicate that lower-than-expected electric vehicle (EV) sales, combined with federal subsidies that encourage building of EV batteries, will create a situation where supply of lithium-ion batteries exceeds demand. Lux Research predicts that worldwide capacity of lithium-ion batteries will reach 18.2 GWh by 2015, with sales coming to just 11.0 GWh.

    “When the U.S. government and other governments offer billions of dollars in subsidies to lithium-ion battery manufacturers to build new plants, they’re going to build new plants,” says Jacob Grose, an analyst for Lux Research. “Unlike the market, which is pretty good at matching supply and demand, governments aren’t considering demand, and they’re creating conditions that are just right for a glut.”

  14. Mike in Nola says:

    To continue belaboring the huge rally in longer duration Treasuries, I would like to point out that it is happening at the same time as the long dreaded net selling of Treasuries by the Chinese. See Mish:

    Here’s my pet theory of what’s going on:

    First, remember that any dollars the Chinese get from us have to be recycled somewhere. In the past, they were just used to buy Treasuries. If the Chinese don’t keep them, they wind up in some other country where they have to be used to buy something denominated in dollars. Where are the “missing” dollars going?

    It’s also been noted that the Japanese have increased their purchases of Treasuries and that purchases through the UK have increased. The latter is often central bank purchasing. See

    In the same article it is noted that China is buying Euros and Yen. Why? My pet theory is that it’s not the long anticipated diversification for diversification’s sake, it’s actually just the Chinese up to their old tricks of devaluing their currency versus trading partners for trade advantages

    Europe is as big trading partner of China as the US is. The collapse of the Euro this spring really hurt Chinese competitiveness in Europe. Note the articles about how well the Germans have been doing selling to China. China can’t allow this; only China is allowed to be a net exporter. So, how do you drive up the Euro? Buy Euros using some of that pile of dollars.

    China is also trading with Japan now. So, they are trying to drive up the yen by using some of the missing dollars to buy yen.

    So, what’s happening is that the Chinese are using some of their stash of dollars to drive up the price of competing currencies. Japan and the EU wind up with extra dollars. Where do they go? Into Treasuries. This neatly explains both the drop in China’s holdings of dollars, the sudden jump in the Euro and Yen, and the continued flow of money into Treasuries.

    I’m sure this explanation is full of holes, but I like it.

  15. crabby says:

    Well, Duh.

    It’s a great point BR. So, a few little guys benefit. The price the elites pay.

    But BSO is still intent on buying votes.

    As a related item, one of my banks lost to the FDIC. I knew they were in trouble by virtue of earlier links here, and knew it was only a matter of time. Suspect it was CRE or small businesses, but no one’s talking.

    They also, being a small local bank, had no access to the free money, which is an evil force today.

  16. Mike in Nola says:

    A comment on our level of political debate:

  17. V says:

    “Inflation, Not Deflation, Mr. Bernanke”
    An interesting read on how inflation could flow through to developed economies.

  18. Thor says:

    Mike – not sure if you’ll see this today or not, but your 9:36 comment last night was brilliant. No one is even talking about that right now so kudos to you for being the first! Can’t see any obvious holes in the logic either.

  19. gordonq says:

    Argentine ants…

    Reminds me of the “meek shall inherit the earth” discussion held here recently, and points to the fact that Spanish will eventually be the dominant language in the U.S. American women value income above kids; Hispanic women do not. Fecundity rules over purchasing power.