My morning reads:

• Fed Faces Risk of Fourth Summer Slump While Pushing QE (Bloomberg)
• Beware of Index Funds That Aren’t (WSJ)
Yardeni: Ignore prelim NFP, focus on regular revisions  (Dr. Ed’s Blog)
• Why Rescue Fragile Banks? Outsource Them Instead (Bloomberg) see also A Wish List of Regulatory Changes for Investors (WSJ)
• Hispanics Driving Real Estate Comeback (World Property Channel)
• Fake Twitter Followers Become Multimillion-Dollar Business (Bits)
• 5 Places Where You Should Never Give Your Social Security Number (Huffington Post)
• Where Have All the Gadgets Gone? (xconomy)
• At least 28 of Max Baucus’s former aides are now tax lobbyists (Wonkblog) see also Where Bank Regulators Go to Get Rich (Bloomberg)
• Sorry, Libertarians, History Shows Bitcoin Isn’t the Future (Bloomberg)

What are you reading?



10-Year Treasury Yield Breaks Uptrend

Source: Bespoke

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.

6 Responses to “10 Monday AM Reads”

  1. hue says:

    castles made of tar sands. Canadian prof: if Prez Obama blocks pipeline, he’d do Canada a favor (NYT)
    “There is a less obvious but no less important reason many Canadians want the industry stopped: it is relentlessly twisting our society into something we don’t like. Canada is beginning to exhibit the economic and political characteristics of a petro-state” (click on devil’s excrement).

    worse thing Obama can say about XL (Esquire)

    pay dirt: how to turn tar sands into oil [slide show] (Scientific American)
    “If oil is the ‘devil’s excrement‘ as a Venezuelan oil minister once complained, then bitumen is the worst of it. Bitumen is essentially tar, hence the appellation tar sands, and it requires roughly 12 barrels of water to separate one barrel of it from the sand, although only three of those barrels are consumed, thanks to recycling.”

  2. Init4good says:

    The Fed, Primary Dealers, and the Ineffectiveness of Monetary Policy

    The Federal Reserve’s primary tool for monetary policy is buying or selling securities, in particularly US notes, bills and bonds.

    But… it doesn’t buy and sell bonds to you and me. Instead, it deals with primary dealers – the complete list is here. The list includes reputable and scandal-free companies such as Citigroup, Bank of America (actually, it’s subsidiary Merrill Lynch, Pierce, Fenner & Smith Incorporated), Goldman Sachs, and UBS. What does it take to get removed from the list? Well, the most recent change to the list occurred when MF Global was removed on October 31, 2011. By coincidence, that was the day that MF Global declared bankruptcy after making almost $900 million of other people’s money disappear. Bear Stearns came off October 1, 2008, four months after the company imploded and sold itself to JP Morgan. Lehman came off a week after it declared bankruptcy.

    Other past luminaries include Countrywide, Drexel Burnham Lambert, Continental Illinois and Salomon Brothers, which makes for an interesting list if you tend to be the kind of person who remembers financial scandals of times past. I have no idea what criteria the Fed uses in picking its primary dealers – clearly controlling massive quantities of financial assets is a requirement, but financial viability and being off the public dole are not.

    In fact, being a primary dealer is a way of being on the public dole. When the Fed confers the primary dealer designation, it confers a large, recurring financial gift on the designee. Remember, the Fed won’t engage in securities transactions with the public, just with primary dealers. So if the Fed is planning to sell bonds for $X, and you want to purchase bonds for $X + $Y, the Fed won’t just sell you those bonds. Instead, the Fed sells the bonds to Bank of America, and making the perhaps unreasonable assumption that Bank of America is able to execute without massively screwing something up, the bank then turns around and sells you the bonds, pocketing $Y.

  3. RW says:

    France Represents The Worst Of The European Trainwrecks And Its Borrowing Costs Are Plummeting

    …falling yields are the norm around the world when weakness sets in. It’s only in peripheral Europe where we’ve been observing this strange phenomenon of surging yields during bad times, and that’s because they’re seen as weak credits that could theoretically run out of money.

    People don’t see that in France, because it’s assumed that the ECB would step in in a big way long before a true sovereign debt crisis erupted in France.

    To complete Joe Weisenthal’s thought: In essence this is an admission that not all Euro’s are created equal; a Euro in Cyprus or Greece (and soon Portugal) cannot be moved about or possibly even used at all but a Euro in France is not so constrained and, with central bank support, bond prices appropriately reflect normal (low) economic expectations rather than insolvency.

    PS: Just noticed Krugman is on this too, declaring France essentially now has its own currency …he’s probably right (as he pretty much has been for the past decade); a nation with its own currency can’t become insolvent by definition.

  4. davefromcarolina says:

    Bull Market Lures Holdouts.

    Fun facts from this morning’s NY Times. Did you know?

    “Investors are ignoring short-term headlines and looking longer term,” he said. “They’re behaving more like investors and less like traders. In the past they didn’t have the emotional mind-set to do that.”

    “There are a lot of great underpinnings for the stock market, such as strong housing prices, a pretty healthy labor market”

    Try substituting “algorithms” for “investors” and see how that works.

  5. Mike in Nola says:

    This is an old article that has become more relevant today:

    Privatising Margaret Thatcher’s funeral would be a fitting tribute to her legacy