The Good News Economist

Mr. Roubini, Please Take a Seat

Oh yes, and HardwareFlooring, I really enjoyed the Y2K analogy...

GNE

Mr. Roubini, Please Take a Seat

@altaman,
>This guy's schtick, as "The Good New Economist," is
>to put a positive spin on everything
>by his own admission.
You got it. That's the goal.

@Misha,
>You are clearly a broken clock.
You are right on. The GNE clock always looks for the silver lining.

@Camden,
>The point is the economic conditions
>are changing and Roubini is not seeing it.
Change indeed is constant.

@Lieberman,
>First quarter GDP to be reported later this week
This will be fun to see. I'm betting we come in at negative 2-3%, but clearly will try to find the silver lining if it's lower... ;-)

@jstratt,
>I am an optimist yet at the same time a realist.
Although many think I am a pollyanna, most would be surprised by how pragmatic I really am. (You might not find it at the GNE website... but have a look at some of the other sites on my blog list that I read... including SA... ;-)

@themacattack,
Thanks for bringing us back to the points of the article for real consideration and debate.
1. Whether or not Robini has used the term "negative feedback loop" or not, he is clearly using calculus terms like "second derivatives" to support a mathematical function that motivates his gloomy outlooks even lower. I reject pure mathematics to describe the market, believing that intangible human factors have much more influence than most pure math models can prognosticate.
2. Yes, there are a significant number of reasons to believe that credit markets have thawed significantly. Number 1 among others:
This year’s record bond issuance so far. That was nearly halted in Oct/Nov... but now continues at a record clip...
seekingalpha.com/artic...
3. I believe that the 0 to 6% spread will be in place for as long as necessary. Earnings will continue to improve and as Wells Fargo puts it, if we can keep earning at that rate, capital [on the books] will take care of itself.

@Artful and Larry,
You guys no doubt "get it".

Thanks all for the comments and debate.
GNE

Banks No Longer in Crisis Mode

@battman,

I don't disagree that the top banks decreased lending. (I have consistently not been an elite(top) bank fan and believe they should be split up and parceled out to the more responsible second tier solid conservative banks)

What I continue to maintain is this...
"overall business lending by *all US banks* was up 12 percent in 2008." The data is very clear on this.

GNE

Banks No Longer in Crisis Mode

@morph366,
As the opening sentence suggests, I am not implying that all is back to normal. I agree that the Fed's job is still difficult, but that doesn't mean they will not be successful.

@ paradigm1974,
Indeed almost all PR firms will concur that appropriate deliberation prior to release of good news is just as important as when then news is negative. One wrong sentence can provoke negativity even when not merited.

@Dustinian,
I too would like to see many of those top teams squirm a bit more. In fact, I'd like to see the mid tier bank execs be given the top jobs... better yet, break up the big banks and divide them up among the top banking teams that have proven the public trust.

@Gary A,
A liquid business is more likely to be solvent than a non-liquid business. However, not all businesses with liquid assets are solvent, and not all solvent businesses have strong liquidity.

@Default 1,
Even Arianna gets it right sometimes. Her quote is right on the mark whether she knows it or not. You may want to have a look at how big residential real estate market is compared to that of commercial.

@Prudent Man,
I disagree with your memory of history. Have a look at this article:
mast-economy.blogspot....
I too was around in the seventies. I really don't see this dip as any different... in fact as that article suggests there is fairly substantial evidence that our current "crisis" has much in common with other historical finance downturns in the past 800 years. (not just 30 years ago)

@mikesa69,
Thanks for reading. A closer look at my profile will reveal my name, my website and my rational for only choosing to cover the good news: the negativity is covered quite well elsewhere...

@WayneinOregon,
Thanks: one of my favorite quotes is "most economists make astrologers look respectable."

@jstratt,
I agree that bank problems still exist. IMHO, your disagreement is a matter of degree. One of the necessary outcomes of the stress tests will be some amount of objectivity in the midst of our subjective terms like "crisis"

@wholesalecd/jay,
Yes, I still "ignorantly" maintain that there really was never a "credit crisis" at *most* banks. Of the over 8000 chartered US banks the crisis was concentrated in the top 20. (A quarter of one percent)... And the total number of banks that have failed since Oct... 37 (not even one half of one percent)

JPMorgan Beats: For Banks, This Is as Good as It Gets

Edward,

Great article on what we may be able to expect from some of these larger banks who are getting their portfolios back in order.

Very interesting "accounting" with WaMu.

Not sure that I agree that this is "as good as it gets." For that I think we need to look at strong banks downmarket... mast-economy.blogspot.... It is in many of the second tier banks where there is true strength moving forward. In reviewing the 10Qs of these banks in the 1B-10B revenue range, there is much less junk exposure in those banks that are one step smaller.

I agree though that this is indeed a very strong report. Particularly your observations in Commercial Banking, Treasury and Security Services, Asset Management, and Private Equity businesses...

GNE