Category: Credit Crisis 2008
The analysis published under this category are as follows.
Monday, October 06, 2008
Euro and British Pound Come Crashing Down to Earth / Currencies / Credit Crisis 2008
By: Money_and_Markets
Jack Crooks writes: Don't look now, but the Eurozone and England are in big trouble.
Actually, you do need to look now because there's no point in turning your head away from what's driving global financial markets and more importantly ... currencies.
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Monday, October 06, 2008
European Banking Crisis Deepens as Germany Guarantees Savings / Currencies / Credit Crisis 2008
By: Mike_Shedlock
I am sure glad Paulson says the global financial system is sound. Otherwise I might be worried when I see reports like this: Financial Crisis: Germany guarantees all private savings; UK 'must follow'
The move to protect private bank account deposits in Europe's largest national economy came after similar moves in Ireland and Greece were widely criticised.
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Sunday, October 05, 2008
Credit Chaos Next– The Mother of all Bank Runs? / Stock-Markets / Credit Crisis 2008
By: Prieur_du_Plessis
Nouriel Roubini: Next – the mother of all bank runs? “It's plain that the current financial crisis is worsening in spite of – or perhaps because of – the Treasury rescue plan. “The strains in financial markets are becoming more, rather than less, severe in spite of the nuclear option of a $700 billion package: Interbank spreads are widening and are at a level never seen before; credit spreads are widening to new peaks; short-term Treasury yields are going back to near-zero levels as there is flight to safety; credit default swap (CDS) spreads for financial institutions are rising to extreme levels as the ban on shorting of financial stock has moved the pressures on financial firms to the CDS market; and stock markets around the world have reacted very negatively to this rescue package.
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Saturday, October 04, 2008
LIBOR Gone Crazy as Commercial Paper Market Implodes / Interest-Rates / Credit Crisis 2008
By: John_Mauldin
The Curve in the Road - Necessary but Not Sufficient
- Why the Government Had to Step In
- All the King's Horses
- How Can I Be 59?
The "Bailout Plan" was passed. Will it work? The answer depends on what your definition of "work" is. If by work you mean no more government intervention and no further costly programs and a functioning market, then the answer is no. But there are things it will do. This week I try to help you see what might lie ahead around the Curve in the Road. We look at how the rescue plan will function, see what is happening in the economy, and finally muse as to whether Muddle Through is really in our future. It will make for an interesting, if not very upbeat, letter, so strap in. I would like your promise to not shoot the messenger. I am just trying to give you some of my thoughts as to what may lie in our future. And remember, as you read this, we will get through it. There are better days "a'coming."
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Friday, October 03, 2008
Anatomy of Financial and Economic Disaster -Part1 / Economics / Credit Crisis 2008
By: Andy_Sutton
For a minute, let's forget about all that has happened in the past year. Forget about the signing of the bailout into law. Let's forget about the failure of some of America 's most iconic Wall Street firms. Let's forget about the insolvency of Fannie, Freddie, and FDIC (yes, they're broke too). Let's forget about Northern Rock, Countrywide, and AIG. They are all but casualties and symptoms. They are not the problem. Read full article... Read full article...
Friday, October 03, 2008
Deleveraging Markets Demand Active Investors / Stock-Markets / Credit Crisis 2008
By: Weekly_Wizards
Jay Matulich writes: What do you see happening with the markets?
What's going on with the markets is what I've been talking with you about for the last year -- that there's a great unwinding of leverage going on, and it's going to continue until at the earliest the middle of next year. What that has done is put a tremendous amount of pressure on selling all asset classes. This winding down of leverage has gone from subprime into other mortgage products and mutated into other areas of the debt market. This has caused all asset classes to be under pressure, since basically all the asset classes from March 2003 went up together, a correlation of 1.0, except for the dollar. As leverage gets unwound all positions get taken off, and it's been very vicious.
Friday, October 03, 2008
$700 Billion Bailout Package a Necessary Evil / Politics / Credit Crisis 2008
By: Brady_Willett
Years from now conspiracy theorists will no doubt contend that the historic $700 billion 2008 bailout package came about because the Federal Reserve and U.S. Treasury wanted to further cement their control over the U.S. economy and government. Focusing on Bernanke and Paulson's apocalyptic words leading up to the bailout vote, not to mention some anti-Fed writings from Thomas Jefferson, conspiracy theorists will note how powerful men scared Congressmen into adopting their plan, how the rules of the financial game were changed to help Wall Street, and how the American public, once again, saw their hard earned dollars stolen from them. Needless to say, what the conspiracy theorists will be doing is giving Bernanke and Paulson far more credit than they deserve.
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Thursday, October 02, 2008
Defense of Speculators and Short-Sellers / Stock-Markets / Credit Crisis 2008
By: Alex_Epstein
Amit Ghate writes: Everywhere today government bureaucrats and media pundits blame unwanted price movements on speculators and short-sellers. If prices are “too high”--it's the fault of greedy speculators; if prices are “too low”--it's the work of evil short-sellers. To hear these critics tell it, speculators have the ability to create artificially high prices, while short-sellers can wantonly destroy sound companies. (Ignore for now the obvious question: “Where are the short-sellers in markets that are 'too high' and the speculators in markets that are 'too low'?") Read full article... Read full article...
Thursday, October 02, 2008
Credit Crisis Government Manipulation- Shocking Answers / Stock-Markets / Credit Crisis 2008
By: EWI
Three Questions The Government Doesn't Want You To Ask About the Financial Crisis And 3 Shocking Answers!
Bob Prechter, President of Elliott Wave International (EWI), is no stranger to challenging the status quo. His New York Times bestseller, Conquer the Crash , was published in 2002 before anyone was even talking about the current financial crisis.
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Thursday, October 02, 2008
Major Insurance Company On Verge Of Bankruptcy: Senator Reid / Companies / Credit Crisis 2008
By: Mike_Shedlock
Bloomberg is reporting Hartford, Prudential, MetLife Credit Swaps Widen to Records .
The cost to protect against a default by Hartford Financial Services Group Inc., Prudential Financial Inc. and MetLife Inc. rose to record levels on speculation that the turmoil in financial markets may be spreading to insurers.
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Thursday, October 02, 2008
Bailout Fixes Nothing, Banking System Collapse Approaches Climax / Interest-Rates / Credit Crisis 2008
By: Jim_Willie_CB
Pardon the brief and jumpy style, laced with more emotion than usual. The events of the last few days have been remarkable, alarming, chaotic, and surreal. Gonna attend the Toronto gold show hosted by the Cambridge House this weekend. If you are there, grab my arm and say hello. Let me know your perspective on the brewing crisis.Read full article... Read full article...
Thursday, October 02, 2008
UK Company Business Bank and Savings Account Guaranteed? / Companies / Credit Crisis 2008
By: Nadeem_Walayat
Whilst individual savers continue to adjust to yesterdays announcement by the Prime Minister, Gordon Brown to extend the 100% guarantee to the first £50,000 for individual savers. However this is an apt reminder that the guarantee does NOT extend much of the business sector, the consequences of which are that corporate runs on banks occur as corporate depositors which amount to some £1.2 trillion seek to immediately withdraw funds from potentially failing banks.Read full article... Read full article...
Wednesday, October 01, 2008
Banking Crisis Bailouts Analysis Costs and Impacts / Stock-Markets / Credit Crisis 2008
By: John_Mauldin
Do government bailouts in times of banking crises work? Philippa Dunne & Doug Henwood of The Liscio Report highlight a major study of 42 fairly recent banking crises around the world. Result? Some types of government intervention works and some don't. One characteristic that is needed though is speed. Dithering, a la Japan, is a recipe for disaster. This is a brief summary of the report (to which they provide a link) and their conclusions as to the basic outlines of what the US should do. Given that Europe is already in the throws of its own bank crisis, and the rest of the world could experience problems, this should be useful reading. They also provide graphs of banking crises and comparisons with developed countries and the resulting market experience. Read full article... Read full article...
Wednesday, October 01, 2008
Corporations Implodes, GE Credit Default Swaps Soar, Ford Sales Plummet / Companies / Credit Crisis 2008
By: Mike_Shedlock
MarketWatch is reporting U.S. Sept. ISM manufacturing index plunges to 43.5%
WASHINGTON - The nation's manufacturers cut back production at a much faster pace than expected in September, the Institute for Supply Management reported Wednesday. This is the lowest level since October 2001. The ISM index plunged to 43.5% in September from 49.9% in August. This is the biggest drop in the index since 1984. The drop surprised economists. The consensus forecast of estimates collected by Marketwatch was for the index to slip only a bit to 49.6%. Readings below 50 indicate contraction. The ISM index has been holding near 50 since the summer. The previous low this year was 48.3 in February. Economists said the ISM index was near recessionary levels.
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Wednesday, October 01, 2008
Spreading Global Banking Crisis and its International Ramifications / Stock-Markets / Credit Crisis 2008
By: William_R_Thomson
The United States prides itself on being the home of free market capitalism, governed by the rule of law. However, the rapidly developing capital market crisis demonstrates once again that, faced with a systemic crisis, rules and ideology take second place to pragmatism. A similar incident happened on 15 August 1971 when Nixon arbitrarily ditched the solemn US international pledge to honour the Bretton Woods Agreements making the dollar convertible into gold at US$35 an ounce. Cynics might say that the US lives by the Gold Rule: he who has the gold makes the rules. Read full article... Read full article...