financemc, I agree that it's print or depression. That's why I predict depression.
It's a mistake to think Germany will do what we would do. As I posted above, Germans do not relent on anything they believe to be a matter of principle. It's a cultural trait. It can even be an admirable trait. In this case, not so much.
That's all well and good except it's not that easy to leave the EU: http://bit.ly/sY6Hvm
This was one of the possibilities that came up for Greece, btw -- leaving the EU. It would presumably have meant a complete default on their debt and a fresh start with their own currency. It was partly because the EU leaders were so afraid of this happening that they freaked out when Papandreou proposed a referendum. What happened next? In one week, Papandreou gone, democracy suspended, and an unelected official put in his place.
There's always this assumption when discussing Europe that Germany could bail out the Eurozone but it's just that the cost of doing so would be so high that it's difficult.
I think that used to be true but I'm not convinced it's still true. Germany's PMI has been dropping for several months and continues to fall. It's now below 50. German unemployment rose last month for the first time since 2009. Germany is already in recession. They just don't know it yet. Meanwhile a liquidity crisis is building as EU inter-bank lending dries up. I'm highly skeptical that at this point Germany can still assemble the resources -- at any cost -- to avoid a complete meltdown of the Eurozone.
" I just wonder if Germany will give into printing before there is a major banking crisis."
I doubt it. Having lived awhile Germany, I'd say there's nothing more immovable than a German who's convinced about the rightness or wrongness of something. Typically, it's not even possible to discuss. It's right or it's wrong and that's it. End of story.
What I expect is a continued series of half measures as the situation worsens and options that were once available to bring to bear on the crisis recede into the past and become no longer available. The real question as I see it is not what will happen to Europe (I assume the worst) but what will happen to everyone else.
The SEC went after CS on the same basis as they went after Goldman. There was even a smoking-gun CS email that ended with a statement about how someone should go to jail. It was disappointing when the SEC settled with CS for only 2M.
DOJ is after them now for aiding and abetting tax evasion. That's an actual criminal charge as opposed to a civil suit. Same as with UBS.
Oddly, I haven't seen CS on the list of banks that Schneiderman is going after....
Last night's 60 Minutes report revealed the startling frequency members of Congress use inside information for personal financial gain. Apparently it's all legal, even this: After receiving secret briefings from Bernanke and Treasury Secretary Paulson as the financial collapse unfolded in Sept. 2008, Rep. Spencer Bachus shorted the market and shorted GE four times. Throw Them All Out, Peter Schweizer says. [View news story]
Tom, thanks for the follow up on Radian. The discussion on monitoring the trajectory of the company's ability to meet its debt obligations -- and its options for doing so -- is useful. I'm wondering if it would have been a good idea to track GAAP "profit" from CDS's. That would have been easy to extract from the ER's and the trend should be a sentiment indicator, right?
As I posted on the original article's page, I exited too. Since my concerns were over management's integrity during the CC, I don't care if price goes up after I exit because I have a hard and fast rule to exit promptly whenever there's evidence of impropriety. That rule is going to be right more often than it's going to be wrong. In the bigger picture, one wants to be on the side with the better odds.
Tyler Cowen says traditional conservative responses to wealth inequality - a stronger work ethic and embrace of the entrepreneurial spirit - are growing tired: "Modern conservative thought is relying increasingly on social engineering through economic policy, by hoping that a weaker social welfare state will somehow promote individual responsibility. Maybe it won't." [View news story]
Tyler Cowen says traditional conservative responses to wealth inequality - a stronger work ethic and embrace of the entrepreneurial spirit - are growing tired: "Modern conservative thought is relying increasingly on social engineering through economic policy, by hoping that a weaker social welfare state will somehow promote individual responsibility. Maybe it won't." [View news story]
People are self-motivated to work hard when they believe their efforts will be rewarded. It's really that simple. Reward need not be monetary either. It can be recognition or the achievement of an important goal. The debate arises from differing visions of what sort of society will enable individuals to in fact reap the rewards of their hard work.
Some posts went missing. What I meant by "That's also stated in the CC" is that management warned in the CC that the reserve limit would almost be reached as soon as the 109M was set aside as a special reserve. Unfortunately the thread it was in seems to have vanished.
Eurozone: Print Or Perish [View article]
Eurozone: Print Or Perish [View article]
It's a mistake to think Germany will do what we would do. As I posted above, Germans do not relent on anything they believe to be a matter of principle. It's a cultural trait. It can even be an admirable trait. In this case, not so much.
Eurozone: Print Or Perish [View article]
Do you really think so? I don't. Not until unemployment in Germany is 20-30%. By then it will be too late.
Eurozone: Print Or Perish [View article]
This was one of the possibilities that came up for Greece, btw -- leaving the EU. It would presumably have meant a complete default on their debt and a fresh start with their own currency. It was partly because the EU leaders were so afraid of this happening that they freaked out when Papandreou proposed a referendum. What happened next? In one week, Papandreou gone, democracy suspended, and an unelected official put in his place.
Eurozone: Print Or Perish [View article]
I think that used to be true but I'm not convinced it's still true. Germany's PMI has been dropping for several months and continues to fall. It's now below 50. German unemployment rose last month for the first time since 2009. Germany is already in recession. They just don't know it yet. Meanwhile a liquidity crisis is building as EU inter-bank lending dries up. I'm highly skeptical that at this point Germany can still assemble the resources -- at any cost -- to avoid a complete meltdown of the Eurozone.
Eurozone: Print Or Perish [View article]
I doubt it. Having lived awhile Germany, I'd say there's nothing more immovable than a German who's convinced about the rightness or wrongness of something. Typically, it's not even possible to discuss. It's right or it's wrong and that's it. End of story.
What I expect is a continued series of half measures as the situation worsens and options that were once available to bring to bear on the crisis recede into the past and become no longer available. The real question as I see it is not what will happen to Europe (I assume the worst) but what will happen to everyone else.
Radian: Why I'm Selling [View article]
Credit Suisse: A Rogue Bank [View article]
DOJ is after them now for aiding and abetting tax evasion. That's an actual criminal charge as opposed to a civil suit. Same as with UBS.
Oddly, I haven't seen CS on the list of banks that Schneiderman is going after....
I'm long AGO, btw.
Last night's 60 Minutes report revealed the startling frequency members of Congress use inside information for personal financial gain. Apparently it's all legal, even this: After receiving secret briefings from Bernanke and Treasury Secretary Paulson as the financial collapse unfolded in Sept. 2008, Rep. Spencer Bachus shorted the market and shorted GE four times. Throw Them All Out, Peter Schweizer says. [View news story]
Radian: Why I'm Selling [View article]
Radian: Why I'm Selling [View article]
As I posted on the original article's page, I exited too. Since my concerns were over management's integrity during the CC, I don't care if price goes up after I exit because I have a hard and fast rule to exit promptly whenever there's evidence of impropriety. That rule is going to be right more often than it's going to be wrong. In the bigger picture, one wants to be on the side with the better odds.
Tyler Cowen says traditional conservative responses to wealth inequality - a stronger work ethic and embrace of the entrepreneurial spirit - are growing tired: "Modern conservative thought is relying increasingly on social engineering through economic policy, by hoping that a weaker social welfare state will somehow promote individual responsibility. Maybe it won't." [View news story]
The difference between Bush's bailout and Obama's was that under Bush there were no strings attached. It was purely a gift to the failing carmakers.
Bush signs 700B TARP bill in 2008, says later would do it again: http://bit.ly/v2XjK9/
The difference between Bush's bailout and Obama's was that under Bush there were no strings attached. It was purely a gift to the failing banks.
Tyler Cowen says traditional conservative responses to wealth inequality - a stronger work ethic and embrace of the entrepreneurial spirit - are growing tired: "Modern conservative thought is relying increasingly on social engineering through economic policy, by hoping that a weaker social welfare state will somehow promote individual responsibility. Maybe it won't." [View news story]
Radian: The Sell-Off Is Overdone [View article]
Reason: It seems improbable to me that management didn't know during the CC that the 109M reserving was imminent.
Radian: The Sell-Off Is Overdone [View article]