DannyBoy29

Former Fed governor Frederic Mishkin says the central bank is unlikely to raise rates significantly for years: While we've dodged a bullet, "we're going to have a tremendous amount of slack in the economy for quite a number of years," he says. "If there's still a lot of slack there's no reason to raise rates. In fact, it would be a big mistake."

Look at capacity utilization, still below 70%. There is no question there is still too much slack to raise rates.

Why Is Obama Timid About AIG?

The gov owns 80% so it is worth 80% of the market cap. Remember AIG did a 1-20 reverse split so it is really only trading in the $2 range.


On Sep 16 08:57 AM rgc wrote:

> How much is the government's stake in AIG worth? With the stock value
> it is trading at, I would hope the taxpayers that bailed AIG out
> have made a killing.

Annals of Research Transparency, JP Morgan / MBIA Edition

You know what's really sad. In our attempt to "reform" the rating agencies they will now have to issue these same useless disclosures.

Housing Bottom? The $1.55 Trillion Effect

Thanks for bringing up the pooints you did in this article. It seems the public and media only focus on the bailouts to the banks, AIG, autos but no one talks about the risk we (taxpayers) are taking on by what is going on at Fannie and Freddie. Like you said it only taks a slightly higher default rate on a $5T balance sheet to cause a major problem. And if that problem happens there will not be a company in need of a bailout it will be our country.

WSJ MarketBeat says as new rules force banks to bring off-balance sheet assets back home, the effects - on capital ratios (and lending), and on the calculus of credit ratings - may be harder to predict than people seem to think.

The real question is will this reallly happen? Banks are lobbying hard against it and since the gov. relaxed m2m why would they do this? Hey I'm all for m2m and bringing the spv's back on balance sheet but i just can't see it happening.

Recession Might Be Over, But Recovery Not Yet Here

It seems as if the media and many people believe that if the recession is over than the recovery must be starting. Reality is however that just b/c the recession is ending that does not mean we will go back to growth like we saw before the credit crisis. I am in the Bill Gross/PIMCO camp where we need to be prepared for a "new normal" where we will be looking at many years of very slow growth.

Absurd Inverse and Leveraged ETF Product Whining (Updated)

Great article. The problem is not the leveraged ETF's but the fact people who do not understand what they are doing try to invest in them. These are trading vehicles not investments. I like to think we still have some sort of free market capitalism left and there is a demand for these products as is evident by the volume on them. People who buy them and do not understand what they are doing deserve to lose money. I use them effectively so don't punish me by taking them away b/c someone else is to dumb to learn what they are doing before buying them.

Moody's: Tarnished Reputation or Tarnished Stock?

As long as they keep getting paid by the companies they are rating (or rating products for) their business has built in conflicts of interest. I am amazed we are still going to allow them to be compensated this way.

Bernanke's Conundrum

My big fear is all the government involvement. I can see a situation where congress, most of whom know nothing about economics, attempts to force rates up to early or conversely tries to keep them low too long for their own political reasons.
Ben has done a good job in my opinion since September 08 and I hope political pressure will not influence him.

CIT's Debt Issues Show Why the Economy Won't Be Picking Up Any Time Soon

What about a fourth alternative, converting debt to equity? Granted it would be dilutive to current equity holders and may not be an option in all cases, I doubt CIT’s bond holders want a potentially worthless stock, but in many cases it is a viable alternative.

Credit Default Swaps: Why I've Changed Sides

CDS' are a useful instrument but as long as you can trade them without holding the underlying debt I still think there are issues. What is to stop me from buying up say $1B in debt of company XYZ and then buying $2B in protectiong in the CDS market. I then do everything in my power to force the company into Ch 11 and collect the $2B in credit default swaps.

Don't Kick Yourself Later for Not Buying Gold and Silver Now

The hype alone will cause it to hit $1,000.

I have been long gold via GLD and EGO for 3 weeks now and short the euro via DRR in a pairs trade. It's nice to finally have something work.


The way I see it if gold were to fall the dollar would have to strengthen so my DRR would hedge losses. If we keep seeing the dollar go up and gold rise as well then I am just going to sit back and make some cash.

Finally Time to Short U.S. Treasuries?

I just bouught TBT yesterday. I'm encouraged to see it up after the fed minutes where they mention pootentialy buying long dated treasuries.

Too Much Optimism for Gilead Sciences?

I've been long since $46 and loving this stock. It might be due for a pullback but no way should anyone short it. A lot of potential positive catalysts out there. Big Pharma need to beef up their pipeline so there is the potential they will be bought. If Obama wants to send more HIV/AIDS drugs to Africa GILD will do well. I'm not sure where the market goes in 09 but GILD should outperform.

Johnson & Johnson Steals Mentor Corp.: Who's Next?

Good article.
I think you have to include GILD in any conversation about big pharma buying a bio-tech. With their HIV/AIDS drugs and the fact Obama will likley try to help the Africa HIV problem I'm sure GILD is on their radar.