JWhitling

The End of the End: Much Needed Perspective on 'Recession Is Over' Debate

A very downbeat, "pile all the bad news in a pile" report, but still somewhat balanced and true.

I cracked up when I read on slide 57 "Reagan's lesson is now almost completely forgotten" in reference to the coming increasing of income taxes on the rich. What a joke that was. Forgotten? How about finally exposed as the debt machine that it is/was? Why did you not call it the GWBush lesson? It's really the same lesson and the lesson is "trickle down economics is as stupid as it gets".

Flash Trading: Goldman Sachs Front Running Everyone Else

It seems "capitalism" has come to mean the legalization of theft almost anywhere you can find a path to the money. Any way you can find a chink to make way to "skim" seems to be allowed for insiders, even encouraged, with a wink. Who does GS bribe to get these rights?

What's the future of capitalism? Can capitalism get any worse than this? After a century of systematic blurring of the lines there are no lines.

I was going to apologize for the rant but after letting this sit on my screen for 10 minutes I realize that I better get on the ball and figure out how to seal "mine", lest I be left behind.

Why Economic Dogma Threatens Our Future Prosperity

Thanks for this moment of clarity! Especially this phrase ..

"Are you all riled up over “news” stories about the shocking involvement of government in business? Especially those Karl Rove psycho-torials in The Wall Street Journal? Well, here’s another little fact you need to digest. Government gets involved in business because business asks them to. That’s right — pop your eyes back in your head and read it again — it’s another undeniable truth. "

It like much of the rest of this article is spot on and worthy of deep remembrance. Thanks much and thanks to the editorial board for bringing this to the surface where I could find it.

NYSE Issues Correction in Goldman's Trading Volume: Anything Else We Should Know?

It's increasingly evident that the individual investor is the turkey on the plate of the markets. What should us turkeys do now?

True Unemployment Numbers

I don't know too many people that work "full time" these days that aren't working 50+ hour weeks, on salary of course. You must allow for that kind of thing in your reporting metric, otherwise we could get further skewed results. Just a thought ..

Bailout Nation: Merkel Reviews Ritholtz

On Jun 14 08:45 AM fran wrote:

> bailout or not[bailout], the USA gov't should not be a loaning agency
> with taxpayer money without taxpayer approval for the new "domestic"
> form of foreign aid. in the repayment, did you get your share?<br/>

Is every "stimulus" package not also a bailout package in that context? And BTW, what do you mean by "my share". Let's get this straight .. my "share", like yours, is a share of DEBT, as in now 14 Trillion divided by 300 million. So I guess, yes, I am getting my share.

Bailouts/loans are justified in the context of increasing or stabilizing tax receipts and minimizing government payouts, much like a company lowers the price of a good or service to increase volume, and thereby increasing your profit/income stream over what would have otherwise occurred. TARP was sold this way, but it didn't happen fast enough with enough conditions to keep the economy going. It just kept the banks going. The money should have really gone to 2nd tier banks for lending and the large banks could have bankrupted themselves without grinding money flows to a halt, as has occurred. Paulson's aim was propping up the investment banks rather than propping up the economic flow. That's how I see it now. Of course it's easy to say that 6 months on. At the time none of us knew for sure what was really happening and how it would play out .. we've gone from too much lending to almost none.

Bailout Nation: Merkel Reviews Ritholtz

I agree, when everyone takes the hit, it's a problem.

But when a LOAN is PAID BACK according to terms, it should NOT be called a bailout. Now, TARP as it relates, especially to AIG, THAT'S A BAILOUT. A large part of the problem is that we're EXPECTING TARP to not get paid back. We must push back against that expectation with every TARP participant.


On Jun 13 05:02 PM Market Sniper wrote:

> All this just goes to prove that when NOBODY takes the hit, EVERYONE
> takes the hit.

Bailout Nation: Merkel Reviews Ritholtz

I'm not really trying to argue the case too strongly, except to say that during the 80's, by and large Detroit built what many people wanted to buy.

If you look at the proliferation of new brands in the US since the early 90's I think you will find that's where the real problems began for Detroit. Unions or not, you cannot compete with third world countries when it comes to labor intensive production.

You can shed all the unions you want .. but how do you ever compete with Korea, for example? I would say that we need to tax the hell out of imports from state run enterprises around the world. State run enterprises ARE NOT free market capitalism, no matter how cheaply they can manufacture.

It's my fervent hope that health care reform will go a long way to putting US manufacturing back on track. IMO, without competitive mfg we're toast. In a country of 300 million not everyone can run a hedge fund, and it's not like our education system is doing more than creating the same series of ultra high educated, and ultra low educated populations. Like it or not, we have to find a way to put the lower classes to work, or there won't be any increases in GDP.


On Jun 13 11:25 AM ritholtz wrote:

> The case I made is that the US auto industry would likely have been
> healthier had Chrysler been abler to restructure in 1980 -- shedding
> the onerous union contract (a carry over from the 1950s) including
> very generous health care and retirement benefits.
>
> We cannot tell for sure because there is no control group -- no counter-factual
> universe where Chrysler is allowed to go belly up. In the book, I
> make suppositions as to what might have happened.
>
> But we do know what DID happen post bailout: In 1980, the big 3
> had a 75% market share in the US; Its now down to 47%. And the UAW
> had 1.5 million members; that is now down to under 400,000, and likely
> to hit 250k this year.
>
> If that is your idea of a successful bailout, I'd hate to see what
> you think a failing one looks like . . .
>
> -Barry

Bailout Nation: Merkel Reviews Ritholtz

I enthusiastically bought this book on it's release and since I follow Ritholtz' Big Picture blog I felt I knew what to expect. Early on in the book, one of things that disappointed me was Ritholtz' recollection of the facts in the Chrysler bailout. One of the key arguments in the book is that any intervention/bailout distorts the market.

I agree with that, in general. But Ritholtz makes a case that letting Chrysler fail in the early 80's would have been good for the US auto industry. He then states that the US auto industry sucked in the 80's. I think not. Ford, for instance, in many of those years had 8 out the top 10 vehicles in the US. That is pure dominance. And in Chrysler's case, the advent of the mini van opened up a whole new market segment for the customer to choose. So, in short, it was not at all like Ritholtz states, and since this is one of his key examples it kind of invalidates the book's arguments. Actually one could easily argue that the Chrysler bailout was a nearly ideal example of the good that can come from a bailout.

After that example I lost interest. I'm sure I'll finish it on some dredge of a flight but I wonder, after that, if I can really get behind the book. If you're going to hang a book on a premise, you should carefully review your facts first.

as a last point .. should it be called bailout if the loan is repaid? I think not ..

Why Isn't Microsoft's Strategy Working Anymore?

Not that it matters, but where is the difference with data loss on a server or in an Access database. If anything the Access database is more insidious. But these examples are why we all backup anyway.

The real point is that to my knowledge, nobody has ever successfully sued for data lose like you exampled .. including MS.


On Jun 08 02:39 PM LA Tech wrote:

>
>
> * JWhitling
> * 12 Comments
> *
> * Follow
>
> Are you saying we CAN sue MS when Excel calcs wrong (it does sometimes)
> or when Access corrupts a series of tables (happens a lot) or other
> things like that? My understanding is that we are on our own when
> this stuff occurs.

Why Isn't Microsoft's Strategy Working Anymore?

Are you saying we CAN sue MS when Excel calcs wrong (it does sometimes) or when Access corrupts a series of tables (happens a lot) or other things like that? My understanding is that we are on our own when this stuff occurs.


On Jun 08 01:16 PM LA Tech wrote:

> GoogleApps users have ZERO ability to sue Google for ANY data loss
> due to Google server actions.

Why Isn't Microsoft's Strategy Working Anymore?

It's funny that a company that needs for it's customers to update regularly, they make it damn near impossible. Can't find an install CD or DVD? Cannot trust upgrades between one OS to another? Cannot just upgrade without learning some retarded forced upon you user interface such as the "ribbon"? Have to update hardware in stupid ways to support the Vista desktop? Who cares about all this crap anyways????
As usual MS ignores it's user base's wishes (always has) and just does damn well what it wants. If they just made it EASY to upgrade users would do it. My own PC has over a hundred gigs of software on it .. am I going to spend a week "upgrading" my OS for MS' benefit? I think not. What benefit do I get out of doing so? The answer is NONE.
This really is one massively retarded and predatory company, and unworthy of anyone's trust and support. How many people do you know that RAVE about any MS software that ARE NOT MS techheads that make their pittance from hooking their wagon to the MS star?
Do you want to own stock in a company like this? I don't, and I've been a MS user since 1985.

FDIC Continues to Sell Performing Commercial Loans at About 50% Off Book Value

Maybe we're all in over our heads .. some just don't realize it yet ..


On May 12 12:41 PM PROXIMO wrote:

> Maybe Ms. Bair is in a bit over her head.

Two Fed Graybeards Speak Out

The test of the marketplace is not stock loses, but rather insolvency. And yes, replace them.


On Mar 06 05:23 PM klarsolo wrote:

> "Test of the marketplace"? Is that guy kidding? Looks like every
> single wouldn't pass the test. Banks that replaced management went
> down. Banks that didn't replace management also went down, almost
> as much it. Is there any stock that is actually up compared to 01/01/2008?

It's Not a Credit Crunch, It's a Deflation

Dirk ,
This attitude you stated is so clearly the cause of problem we now have to wrestle with ..

"You're spot on in your analysis, except there are positives to inflation.
It stimulates demand, it makes borrowing easier, it creates wealth effects, and it creates some dynamism in pricing that allows for relative shifts to take place."

Right now we are learning that there is a price to be paid for inflation. We are paying the piper now, and probably for the next decade or two. Of course, without inflation you have a hard time making an easy 7-10% return on blind investments. Investors will have to take far more risks for those kinds of returns and there will be a genuine risk to investing.