whidbey

Markets, Macroeconomics and the Fed

This Krugman article has hit a vulnerable and guilty marketplace, but the piece is nothing more than propaganda for a Keynesian economist who was a blind as anyone else was. His analysis focuses on what to do about the wreck - but after it happened.

It is true that things did not go well because Greenspan and a Congress wanted to spend money (Medicare part D for example, and buying union votes for sure) They were on a role and loving the political capital they thought they were building. Their miscalculation was based on not understanding free markets: Free markets go where the money is, they poured everything into debt financing because rates were low. Sell, Sell and sell more.

But they were wrong and should have known it; The government actually assumed that housing could go up forever, or a long time, and would make great social change for the good. Virtue and opportunity to make money: does it get any better?

But they made a pure miscalculation that Krugman nor, Bernanke, nor anyone saw as stupid and fatal. They missed the adage: ""nothing goes up forever"". They missed the caution "" when everything is going into one play the market has it wrong"": no market is ever dominated by one or a few investment plays. The missed the lack of credit reviews. They would not have loaned you money without knowing your assets and payment habits, but they loaned public funds it to millions that they did not know anything about.

Krugman is just a professional hack who got his job at Princeton by being a socialist economist who looks for government roles and denounces private roles. What has he offered on finding jobs (money to the Nat Endowment for the Arts?), closing zombie banks (yet to come), controlling Congressional spending (why? if it is directed to social justice), reducing debt to match tax revenues (if I have told you once I said it a thousand times: deficits don't matter!!). Paid him no mind and buy some bonds the world is going to end soon and we hope it takes Krugman with it.

An Insider's View of Ginnie Mae MBS

Bad news, but not all GMNA loans are affected???

The problem is that not all originators exercise the same degree of care in making loans. In the end the agency is expected to supervise the standards, but we know political pressure even today is still very high and immoral. So is the last sweet pot about to go sour ? Yes, it is all rotten, and we know housing debt will consume everything eventually. The congress wants to revive a dead market. Welcome to hell where everything burns sooner or later.

The FHA Meltdown

Disgraceful? It is a conspiracy to end the US economy on the road to greater social fairness. It is all a political game at the expense of those working and earning a wage who must attempt to pay-off the debt than gay old barney is willing to run up so he can stimulate the up scale housing market.

Expect Unemployment to Remain High

Certainly looks good to a socialist, more medical jobs and more health care at a lower unit cost as the president says. Can it get any better?

Purchasing Power Comparisons

The CIA fact book is dated and biased as well. If you want good data look at the OECD data which is at least annually revised. The facts you quote are difficult to compare as the prior comment suggests.

3 Reasons Why Gold ETFs Are on a Rush

The move has got to be ill timed unless the market knows something we do not sense as yet. This fall the equities are headed for a blood bath, why would gold escape?

The Case for Moving iTunes to the Cloud

It is the way things are going and the move will hopefully stimulate a mass move to the cloud.

Closing Update: Stocks String Together 3 Straight Wins, Commodities Gain

"July consumer credit fell at 10.4% rate, the biggest decline since the government began keeping records."

This is the type of indicator that tells us we are not headed toward a recovery any time soon.

The market can do as it will, but the belief we are heading into a growth in demand is silly. The stimulus and junker car programs were going in July and consumers did not spend; may have paid down some debt. The road to nowhere is long and winding and we have just started. Liquidate the dead banks and start over in banking.

What Gold's Breakout Means for Stocks

Your arguments are persuasive to me, but there is the problem of the stimulus that is allegedly the driver.
We know this rally cannot last without permanent damage, so whatever the correlation and direction of movement we must be aware that all is for naught ultimately. The recovery is just a phase in a longer bear market and gold is a symptom of what? A better investment than equities?

Bond Expert: Tuesday Outlook

Macro man is likely correct. Bonds can go either way, but contemplation of a correction is lurking in the minds of many, so they will keep some bonds just in case. Geithner and gang have a long cold winter ahead of them and they are just the men to paint the town with paper while lecturing the G20 on getting control of the financial institutions. Were that we had such prospects in government, treasury to be exact.

Intel Anticipating a Refresh of Corporate IT Spending Cycle

This Intel statement is free advertising from the industry, but may foreshadow a dirty deal too.

The fact that MSFT has plans to launch its new horror show, "system 7", is no reason to buy a box to run it, unless (don't count this out) the idiots at Softy failed to make it fully backward compatible with prior MSFT OSs. The backward compatibility issue has occurred with MSFT before and we can not preclude some collusion to force the corporate markets to buy or go blind.

They are a lovely group feeding Africa and stomping on the toes of the US market. No wonder the EU/UK hate the company.

The Enterprising Investor’s Guide 9-8-2009

"With sentiment solidly bullish and the market’s valuation unattractive, we are proceeding with caution."

I think you make a great case that valuations are not "normal" but due to non-operating adjustments.

What needs watching is the financial sector which is running on smoke and mirors. The earnings of the sector are not commensurate with their level of operations, and it will not be able to attract capital for the refunding that is required to remain viable. When this becomes obvious to investors, the "adjustment" starts and it will likely be based on a bitter realization what we was had by the Treasury secretary and the Fed. The bad part is the FDIC is not ready for the new demands and may terrorize millions of small depositors.

Graham Corporation: Ready to Skyrocket

Skyrocket! Add to your Watch list? Which is it? Could we get real for a minute? This stock suffered a hell of a turn down, its cash and potential earnings notwithstanding. This is a message that the market questions its earning ability in what you call...... "a bit of turn-down".

GHM maybe a great stock, but right now it appears to have been abandoned. When and in what circumstances to you see the Rocket taking off? Or is this a one time appearance on SA. I think the latter.

Five Charts to Rule Them All

"We identify changes in trends by looking for not only price action of a particular market or market sector, but also by corresponding changes in other markets."

You bet it is not a science, it isn't even supported by historical market prices movements. The five charts you selected are trend-less and you can stare at them until you are cross eyed, but there is little if any correlation obvious. I think your toy is busted, and you haven't caught on yet.

Tuesday FX View: Dollar Kicks Around in the Dust

Your comments are interesting. You think stimulus must come to an end? Why? What other programs of the Administration are in place to end dependence on government spending?

It appears to me that we are having second thoughts about stimulus of any kind, but have no choice since the banks are loaded with junk and consumers are largely unwilling to spend.
We are threatened by deficits based on new public programs.

Something go on in the gold markets??

Gold prices are a speculation by many on the fact the government has no economic program to allow the unloading of bad credits and the rectification of the banks. The speculation is on failure becoming the dominant feature of our economy.