Category: Credit Crisis 2009
The analysis published under this category are as follows.
Tuesday, January 27, 2009
UK Banking Sector and Housing Market Reverting to Below the Mean / Economics / Credit Crisis 2009
By: MoneyWeek
Banks have money - they just don't want to give it to most people - The job losses are stacking up across the world. According to The Times , about 70,000 jobs went globally yesterday. Most of the cuts were in the US - construction equipment maker Caterpillar is cutting 20,000 jobs, while mobile phone operator Sprint Nextel is cutting 8,000 posts. Read full article... Read full article...
Tuesday, January 27, 2009
Warning: Mega-banks Could Fail Despite Federal Bailouts / Companies / Credit Crisis 2009
By: Money_and_Markets
Martin Weiss writes: The time has come to issue one of my sternest warnings to date: Bank of America and Citigroup could fail despite the most radical government rescues of all time.
Right now, after recent close calls with instant death, these two megabanks are on life support, receiving massive transfusions of government capital. But they're still hemorrhaging, and no one in Washington has found a cure.
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Tuesday, January 27, 2009
Protectionism and the Global Banking System Technical Insolvency / Economics / Credit Crisis 2009
By: John_Mauldin
This week I bring you two different articles as an offering for Outside the Box. As a way to introduce the first, let me give you the quote from Merrill Lynch economist David Rosenberg about the rising threat of global trade protectionism:
"The Financial Times weighs in on the rising threat of global trade protectionism in today's Lex Column on page 14 ("Economic Patriotism"). The FT points out that the stimulus packages of many countries include "buy local" provisions. At home, there is a proposed inclusion of a 'Buy American' provision in the economic recovery package and this could set off trade retaliation from importers of US goods. Here is what the FT had to say, 'It was trade protectionism that made the 1930s Depression "Great". Congress would do well to understand that it is in everyone's interest to keep trade open today.'"
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Monday, January 26, 2009
Jim Dandy to the Rescue of the U.S. Economy / Politics / Credit Crisis 2009
By: Steve_Selengut
More than fifty years ago, LaVern Baker & The Gliders, brought Jim Dandy into the fray to lasso runaway horses, dry the tears in little girls' eyes, and to save special mermaids from the hooks of villainous fishermen. (Black Oak Arkansas' rendition on You Tube will help you understand what your parents and grandparents survived.) Go, Jim Dandy! Go, Jim Dandy!Read full article... Read full article...
Monday, January 26, 2009
Financial Crisis Hits Obama Presidency as Republicans Plan to Oppose $825 Billion Stimulus / Politics / Credit Crisis 2009
By: Money_Morning
William Patalon III writes: President Barack Obama's $825 billion stimulus plan heads to the floor of the House of Representatives this week, with House Minority Leader John A. Boehner, R-Ohio, saying many in his party will vote against the package unless significant changes are made.
“Right now, given the concerns that we have over the size of this package and all of the spending in this package, we don't think it's going to work,” Rep. Boehner said yesterday (Sunday) on NBC-TV 's “Meet the Press.” “And so if it's the plan that I see today, put me down in the ‘No' column.”
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Monday, January 26, 2009
The Economic Perversity of our Banking System / Economics / Credit Crisis 2009
By: Joseph_Toronto
I recently wrote about the cause of this recession/depression being a collapse of the money supply. The money supply is collapsing because money is literally evaporating with each loan default and bankruptcy and is accelerated by the reverse multiplier effect of fractional reserve banking. Furthermore, given that the collapsing money supply is causing recession, banks are making things worse by doing exactly what banks are supposed to do to preserve their rapidly eroding capital. They stop their lending in a risky economy and buy risk free T-bills or earn interest in their excess reserve account at the Fed. This is the correct thing to do for bank stockholders, but incredibly and perversely is exactly the wrong thing to do for the economy. Read full article... Read full article...
Monday, January 26, 2009
Obama Announces "New Rules" To Address Financial Crisis / Politics / Credit Crisis 2009
By: Mike_Shedlock
As part of his rescue plan, Obama Signals Tough Restrictions on Banks in Rescue Package .
President Barack Obama signaled that he would toughen restrictions on and oversight of banks as part of a fresh plan to aid the battered industry.Obama blasted the banks yesterday over reports that they've spent money renovating offices after receiving billions of dollars from the government and vowed they would be held accountable for any aid they receive in the future.
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Sunday, January 25, 2009
Protect Your Wealth Using Alternative Investment Strategies / Stock-Markets / Credit Crisis 2009
By: Submissions
VelShan Thani writes: There are many arguments among the economic analysts and experts about whether we are having inflation or deflation or stagflation or depression and so on and so forth.
I was prompted to write this article by those arguments.
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Friday, January 23, 2009
Global Systemic Financial Crash as Extreme Leverge Deleverages / Companies / Credit Crisis 2009
By: Mike_Shedlock
Inquiring minds are investigating a visual comparison of banks' market caps valuation as of January 20, 2009 vs. the second quarter of 2007. Bank Market Cap Comparison
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Friday, January 23, 2009
Great Britain- The “Rust Belt” of Global Finance / Economics / Credit Crisis 2009
By: Money_Morning
Martin Hutchinson writes: Think about Michigan or about Ohio's Mahoning Valley in the 1980s. Both were famous for industries that were world leaders in their time. Yet, once those industries decayed, large parts of both areas became wastelands of home foreclosures, crime and alcoholism.
The decline of the global financial services industry from its unsustainable 2006 peak may produce a similar effect in a once economically thriving country – Britain.
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Wednesday, January 21, 2009
The Obama Blueprint for Solving the U.S. Financial Crisis / Politics / Credit Crisis 2009
By: Money_Morning
By Jason Simpkins
And William Patalon III write: The first 100 days of President Barack Obama's administration officially begin today (Wednesday). But the reality is that President Obama already has a solid head start, as he and his advisor have been working for months to establish the groundwork for one of the most ambitious - and most important - economic-stimulus plans in U.S. history. Read full article... Read full article...
Tuesday, January 20, 2009
British Banks are Technically Bankrupt as BOE Prints Money in Secret / Companies / Credit Crisis 2009
By: Mike_Shedlock
The Independent is reporting (was reporting but the post has been yanked) British banks are 'technically insolvent' . The link above as well as what follows is from Google cache. Not sure how long that cache will stay but here is the article that someone, for some reason, wanted to suppress.
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Tuesday, January 20, 2009
Credit Crisis Explained: History of Debt Bubbles and Long-term Interest Rates / Interest-Rates / Credit Crisis 2009
By: John_Mauldin
There is a reason I call this column Outside the Box. I try to get material that forces us to think outside our normal comfort zones and challenges our common assumptions. And this week's letter from Hoisington Investment Management Company does just that. Let me give you two quotes to pique your interest: "Monetary policy works by creating the environment for a renewed borrowing and lending cycle. This cycle would require that the debt to GDP ratio, which is already at a record level, grow even higher. Would such an outcome really be that desirable when the controlling problem of the U.S. economy is too much improperly financed debt? If the Fed were able to engender an increase in the debt to GDP ratio, this might merely serve to postpone the reckoning of the current debt levels while laying the foundation for an even more vicious unwinding down the road.Read full article... Read full article...
Monday, January 19, 2009
Bailed Out Banks Seek More Money to Fill Financial Black Holes / Politics / Credit Crisis 2009
By: Dr_Ron_Paul
Strengthening or Weakening the Economy? - The economic situation continues to deteriorate this week as past and future bailouts were discussed on Capitol Hill. The debate was over the accountability of already disbursed TARP money, and on whether or not to release remaining funds. Banks that had already been bailed out before are looking for more money to fill the black holes that are their balance sheets, warning that they are simply too big to fail.Read full article... Read full article...
Monday, January 19, 2009
Entire TARP Program a Financial Disaster and Bureaucratic Nightmare / Stock-Markets / Credit Crisis 2009
By: Money_and_Markets
Martin Weiss writres: Just a month after our trusted leaders in Washington told us that the debt crisis was over …
Just a week after Wall Street was still rejoicing with a great “Obama rally”…
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Monday, January 19, 2009
Credit Crunch Back in Action / Stock-Markets / Credit Crisis 2009
By: Regent_Markets
After taking some time off between Christmas and New Year, the credit crunch was well and truly back in action last week. Fears over further banking problems and sovereign debt downgrades for the likes of Ireland and Greece surfaced last month, but until now, these fears have merely been simmering in the background. Last week, the heat was once again turned up, and major fault lines are once again running through the global economy.Read full article... Read full article...
Sunday, January 18, 2009
Global Banking Crisis Worsens as Bailout Capital Exceeds Net Worth of Banks / Stock-Markets / Credit Crisis 2009
By: Prieur_du_Plessis
BBC News: US banking giants in tie-up deal
“Struggling US banking giant Citigroup and its rival Morgan Stanley have agreed a deal which sees the tie-up of their brokerage operations. Morgan Stanley is paying Citigroup $2.7 billion for a 51% stake in the joint venture while Citigroup will have a 49% stake.
“Observers say the deal showed how much Citigroup wanted to slim down its operations and build up cash reserves. It received the largest government bail-out of any US bank last year.
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Saturday, January 17, 2009
Deflation? Stimulus? Deleveraging? Recession? Soft Depression? / Economics / Credit Crisis 2009
By: John_Mauldin
- The Endgame
- Employment Numbers Are Worse Than Posted
- Aye, Captain, I'm Giving Her All I've Got!
- Problem #1: Deflation
- Problem #2: Pushing on a String
- The Muddle Through Middle
Deflation? Stimulus? Deleveraging? Recession? A soft depression? A return to a bull market? With all that is going on, how does it all end up? When we get to where we are going, where will we be? In chess, the endgame refers to the stage of the game when there are few pieces left on the board. The line between middlegame and endgame is often not clear, and may occur gradually or with the quick exchange of a few pairs of pieces. The endgame, however, tends to have different characteristics from the middlegame, and the players have correspondingly different strategic concerns. And in the current economic endgame, your strategy needs to consist of more than hope for a renewed bull market.
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Saturday, January 17, 2009
Financial Black Holes Destroying Capital / Stock-Markets / Credit Crisis 2009
By: Money_and_Markets
Mike Larson writes: When I was a kid, black holes fascinated me. The idea that you could have an area of space so massive … so dense … that it could suck in and absorb ANYTHING that got too close — even light — seemed ludicrous. Like pure science fiction. But they're real.
These days, black holes aren't so fascinating. But unfortunately, they are very, very real. And they keep popping up throughout the financial sector …
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Friday, January 16, 2009
Credit Where Credit is Due / Economics / Credit Crisis 2009
By: Peter_Schiff
This week, in a speech before the London School of Economics, Fed Chairman Ben Bernanke offered a perverse economic theory in his quest to gather support for never-ending Wall Street bailouts; "This disparate treatment, unappealing as it is, appears unavoidable. Our economic system is critically dependent on the free flow of credit, and the consequences for the broader economy of financial instability are thus powerful and quickly felt." In other words, credit is the lifeblood of our economy, and the continued operation of credit providers is an issue of national security.Read full article... Read full article...