10 Tuesday Late Afternoon Reads
By Barry Ritholtz - September 6th, 2011, 4:30PM
Afternoon reads:
• Dow headed below 10,000 as cyclical bear begins (Market Watch)
• How your emotions can cost you money (CNN Money)
• The Eurozone Could Break Up Over a Five-Year Horizon (Credit Writedowns) see also Europeans Talk of Sharp Change in Fiscal Affairs (NYT)
• Are stocks undervalued? (Market Watch)
• Bank of America’s Buffett Premium is All Gone (and Then Some) (WSJ)
• For the Economy, the Real Slam Dunk Is Debt Forgiveness (Bloomberg)
• Data scientist: The hot new gig in tech (Fortune)
• Occupy Wall Street will lay siege to U.S. greed (Market Watch)
• James Murdoch ‘was told of phone-hacking email’ (Guardian)
• Earth from 6 million miles away (Earth Observatory)
What are you reading?
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September 6th, 2011 at 6:29 pm
Noticed this quote by Dennis Gartman at the beginning of John Mauldin’s Outside the Box E-Letter rec’d today:
“…….S&P has said over the weekend through one of its senior spokespeople in Europe that if a EUR-bond is underwritten it shall have the rating of the lowest rated constituent country involved and thus will have coupon far, far above that of Germany, or France or Belgium et al. A EUR-bond would thus have the credit rating of Greece!”
If this is true, then the Euro Bonds probably won’t work, unless they can phenagle some way for the ECB to buy them, but with their current sterilization procedure (which I don’t really understand very well)
I don’t foresee them finding enough funding from the core Euro countries to finance Spain and Italy,
or even China to step in (with huge concessions for them) or other foreign central banks and countries (IMF) and assist in some way sufficiently for that matter. Too much risk……too many foreseeable haircuts.
According to this Reuters piece, Greek bonds currently have an S & P credit rating of CCC….very bad:
http://www.reuters.com/places/greece
Per Bloomberg charts:
Current Greek 2 yr yield: 52.31%
http://www.bloomberg.com/apps/quote?ticker=GGGB2YR:IND&n=y#
Current Greek 10 yr yield: 19.81%
http://www.bloomberg.com/apps/quote?ticker=GGGB10YR:IND&n=y#
I don’t see how the Euro Zone is going to survive this without some major haircuts to bondholders-Euro banks through the current Euro Zone structure or via some of the PIIGS splitting off from the Euro Zone and devaluing their respective currencies and resulting in major losses to their bondholders.
Well, that’s my 2 cents worth, for whatever it’s worth, LOL.
September 6th, 2011 at 6:47 pm
Janet Tavakoli has this piece with the great title; “Fraud as a Business Model”
‘Banks won’t change until we follow the law and take “prompt corrective action.” Banks that committed widespread fraud should be placed in receivership. Bank of America was cited by William K. Black and L. Randall Wary in their October 2010 post as the place to start, and I agree.’
http://www.huffingtonpost.com/janet-tavakoli/fraud-as-a-business-model_b_950806.html
September 6th, 2011 at 9:25 pm
…are we talkin’ about another bank run?…i believe it has been going on for a while in euro-land, in particular, Italy, and other Southern euro countries…do “they” run for the safety of the euro – the euro’s issued by german banks, in particular?… the USD?, probably, at first, then…commodity country currencies – CAN, AUS, etc…developing countries – BR, CNY…or simply straight into Au?
September 6th, 2011 at 9:26 pm
I caught you on PBS NewsHour .. a bit somber tone I thought .. nothing to add since imo somber is the mood and …
http://www.pbs.org/newshour/bb/business/july-dec11/economy_09-06.html
September 6th, 2011 at 9:35 pm
It might have made them laugh 1n the 1930s if they knew that someone would be wishing for a man like Coolidge to vote for in the 2010s.
September 6th, 2011 at 9:42 pm
Earth from 6 million miles away . . .
So much trouble on such a small dot.
Looking at the photo, it is understandable why the political right hates science. Same goes for this pic:
http://www.spacetelescope.org/images/heic0406a/
We are infinitesimal in The Big Picture, and we know it, yet we seem hell bent on destroying our speck of RRE. I guess all of that worry goes away if you believe there’s a magical being who cares deeply for us*, and who can be called on via ritualistic ceremony to set everything right (for rain in Texas, for example), when we really fuck things up.
* Some restrictions apply. See your holy man for details.
September 6th, 2011 at 9:45 pm
http://www.washingtonpost.com/national/health-science/scientists-call-for-end-to-deep-sea-fishing/2011/08/30/gIQApPJc7J_story.html?hpid=z3
September 6th, 2011 at 10:00 pm
Robert Reich on the effect of Inequality on economic recovery in NYT:
I haven’t see you write much about the inequality which has developed in the US – can we recover when so few assets are in the hands of the middle majority of wage earners?
~~~
BR: You should learn to look better.
Here’s the Reich piece I discussed over the weekend, and here’s this and this and this (see this via the site search)
I always assumed Standford taught basic search skills, considering thats were Google was born . . .
September 6th, 2011 at 10:14 pm
@Petey Wheatstraw
I thought you were going to post us up a little Sagan.
Never more pertinent than now.
http://www.youtube.com/watch?v=p86BPM1GV8M
September 6th, 2011 at 10:24 pm
Somber? He looks like he’s ready to sit court side at a Knicks game. The beach is treating you well BR.
September 6th, 2011 at 10:43 pm
There’s a story around a lot of news sites about BoA robot-calling some new widow 48 times a day to demand their mortgage payment. The details make it even worse than it sounds in the headlines. At this point, with the bank in deep and worsening trouble, you’d think they would try their best to avoid any further publicity nightmares; I mean, a moron could see where this collection practice was going to end up — in the media and then in the courts. Just sayin’.