Lilguy

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50 Comments

    • Fri Apr 25th 11:16 AM | Rating: 0 0
      Commented on:
      Thoughts on Inflation, or is that Deflation?
      Greatly appreciate your efforts to put together this comparative analysis. It is very useful in corroborating or debunking others' claims that our current situation is "just like" (pick your recession/depression). It's useful to have this tool to give a check on those assertions. Thanks.
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    • Thu Apr 24th 15:22 PM | Rating: 0 0
      Commented on:
      Closer Look at Household Balance Sheets
      I have to wonder if consumer spending isn't like beer drinking: 90% of the beer is drunk by 10% of the drinkers.

      If so, a small (but significant) portion of our populace will take on virtually all the effects of the recession. I'm thinking it's those underwater and defaulting on mortgages.
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    • Thu Apr 24th 15:12 PM | Rating: 0 0
      Commented on:
      A Simple, Honest Proposition: Housing Data Interpretation First, Conclusions Later
      First, for No Doodahs: As much as I hate to say it, this is one place where NAR's use of the MEDIAN home value (from which one can calculate the change) is the best of the three. By picking the middle value, one avoids overweighting the effects of the few high-priced homes OR the many low-priced homes. Still, the trends have been really bad MOM or YOY since 2006.

      Now for Jeff: Yep, I agree, analysis before conclusions is a good concept! I try to use it regularly. Re seasonality, however, I have failed to see why "seasonally adjusted" values should affect YOY comparisons. Aren't there four seasons in a year? Shouldn't the same overarching market forces be at work in March 2008 as in March 2007 (or whatever month)?

      I often find these YOY seasonality adjustments steeped in methodological poppycock usually meant to skew the figures favorably (whatever direction that may take), whether its RE or labor or whatever. For me, seasonality factors should not apply in YOY comparisons, and I routinely disregard them in analysis when I have the choice.
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    • Wed Apr 23rd 11:26 AM | Rating: 0 0
      Commented on:
      The Impending Mortgage Crisis
      For MHuntington--I too am a NOVA resident. I think the reason lies in the belief of businesses and politicians locally that the region is "recession-proof&... because of the role of USG employees and contractors in its economy. This may be partly true, but as we see companies LEAVE the area (eg--Sprint) and others suffer significant losses & layoffs (FNMA, FHLMC, SallieMae), I think the banks and other so-called leaders' attitudes will change. We just aren't as recession-proof as we used to be.
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    • Mon Apr 21st 11:31 AM | Rating: 0 0
      Commented on:
      Insider Trends in the Financial Sector
      Either Karim does not know what he is talking about OR he is deliberately misleading readers of this blog. (He does not disclose whether he has a position in any of the companies he mentions.)

      It may be appropriate to pull this contribution from this website.
      View article »
    • Fri Apr 11th 10:08 AM | Rating: 0 0
      Commented on:
      GE Earnings: Industrial Bellwethers Are Now Getting Hit
      Kathy--Despite its inclusion in the DJ Industrials, GE is truly the poster child for conglomerates. Its earnings fell short because of shortfalls in its large (40% of revenues) financial business, not in manufacturing. The key reason the stock dropped today is that the CEO said things were OK as recently as two weeks ago, so the downside surprise was really a surprise to WS analysts. (I don't think it was a surprise to serious investors who research the stocks they buy.)
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    • Thu Apr 10th 21:40 PM | Rating: 0 0
      Commented on:
      Financials: It's the Solvency Issue - Again
      The banks are declaring their bad debts as they are able to line up new capital. If you look over the last few months, the combination of new stock issuances by banks, loans to them by sovereign wealth funds and others, Fed aid by switching out their bad debt with good US treasuries is almost equal. In fact, the point that liquidity has diminished rather than improved suggests that the banks haven't been able to keep up with their bad debt.

      The banks will continue this strategy as long as they can, probably until all the bad debt is matched by new capital. That will take at least until early to mid-2009.

      Don't look for resolution any sooner.
      View article »
    • Sat Mar 29th 10:07 AM | Rating: 0 0
      Commented on:
      Meredith Whitney Threatens Severe Deflation For Your Portfolio
      Your commentary tells me much more about you than it does either Ms. Whitney or Citigroup.

      I note you did not disclose whether you hold Citigroup or any of the companies you deman in your screed.
      View article »
    • Fri Mar 28th 12:45 PM | Rating: 0 0
      Commented on:
      Investor Sentiment and Market Returns: Now's the Time to Be Bold
      No doubt market sentiment is bearish. The question is whether we're at the bottom of the bearishness (and the market), or will we beat the -37% record that now stands. And if so, when?

      If you believe, like I do, that the current recession will be moderate, but longer than average, ending maybe in late 2009 or 2010, this would not be the time to jump in the pool.

      The water could get even colder in the next few months.
      View article »
    • Thu Mar 27th 11:24 AM | Rating: 0 0
      Commented on:
      How Will the Housing Crisis End?
      Thank you for providing a process by which one can make some reasonable judgments about the state and futue of the housing market. This is far superior to pundits just offering an opinion or a single data point.

      Thanks.
      View article »
    • Fri Mar 14th 10:23 AM | Rating: 0 0
      Commented on:
      Financial Stocks Trading Near Book Value
      Price-to-book usually is valued at the company's stated book value or maybe an independent analyst's assessment.

      None of that matters. What matters is how the company's counterparties see the book value and, more importantly, risk. If it looks bad, margins to up, liquidity shrinks, and insolvency follows--unless you can arrange for a bailout from your friends.
      View article »
    • Thu Mar 13th 21:42 PM | Rating: 0 0
      Commented on:
      CFOs: Recession Has Already Started
      That graphic is amazing!

      CFO optimism peaked in 2003 and has been going down hill ever since (with wiggles, of course). So, are they addressing the cyclical aspects of the economy and stock market--which generally started going up in 2003 and peaked in mid-2007--or are they looking at a larger global macroeconomic picture--the role of the US in the global economy. Or maybe they're reflecting some Ellliot (no, not Spitzer!) Long Wave theory bear cycle.

      I'm just surprised they haven't seemed to have a good day in five years.
      View article »
    • Tue Mar 11th 10:30 AM | Rating: 0 0
      Commented on:
      The Mortgage Crisis: Time for Real Solutions
      You say, "There are a lot of effective and relatively easy to implement solutions available . . . ."

      OK, like what???
      View article »
    • Tue Mar 11th 10:26 AM | Rating: 0 0
      Commented on:
      Central Banks, in Panic Mode, Announce Large Auction
      Either the Fed had to do this, or Congress would have had to rescue the housing agencies with new capital--because they are all but busted on their mortgage loan losses.

      Obviously, it also helps others who are holding increasingly bad agency debt.

      And, as you say, it's better than huge FFR cuts.
      View article »
    • Sun Mar 2nd 21:06 PM | Rating: 0 0
      Commented on:
      Can the Fed Really Afford to Cut Another 50-75 Points?
      While lowering interest rates is the standard way to increase liquidity in the credit markets during recessions, it has proven feckless so far in this recession (yes, RECESSION). All that it is doing is enabling heavily leveraged banks to borrow more cheaply to shore up their own account. Neither potential business nor consumer borrowers are seeing a greater credit availability. Indeed, credit continues to shrink against a backdrop of higher interest rates and stiffer qualifying requirements.

      The Fed MUST recognize this immediately and (1) limit further reductions that stimulate both inflation and dollar devaluation and (2) find a more direct way to reach worthy borrowers without going through the money center banks, which are nothing but a financial black hole.
      View article »
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