After no criminal charges at MF Global why not start a hedge fund….

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“Spain is about to receive an emergency disbursement from the 100 billion-euro ($123 billion) bailout of its financial system because of restrictions the European Central Bank imposed on bank borrowing, according to a person familiar with the matter.”

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As investors fret over growth concerns they are pulling their coin out of China. This is expected to hurt any potential recovery.

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Asia did not celebrate Wen Jiabao’s comments as one would expect; but the markets can feel more confident in central bank action going forward.

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Shares of Facebookhave tanked nearly 50% since the social network’s highly anticipated initial public offering back in May. …Here’s a rundown of ten hedge funds who owned the most shares of Facebook for the second quarter ended 6/30/2012, according to data compiled by Bloomberg.

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“Stronger U.S. economic data have reduced the probability that the Federal Reserve will announce a third round of so-called quantitative easing when policy makers gather next month, Goldman Sachs Group Inc. said.

“We do not expect a move to QE3” at the Sept. 12-13 Federal Open Market Committee meeting, Jan Hatzius, chief economist at Goldman Sachs in New York, wrote in a note to clients, citing retail sales that rose more than forecast in July.

“While QE3 at the September 12-13 FOMC meeting remains possible, our best estimate is that it will take until late 2012/early 2013 before Fed officials return to balance sheet expansion,” Hatzius wrote.”

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“The same problems that plagued the foreclosure process — and prompted a multibillion-dollar settlement with big banks — are now emerging in the debt collection practices of credit card companies.

As they work through a glut of bad loans, companies like American Express,Citigroup and Discover Financial are going to court to recoup their money. But many of the lawsuits rely on erroneous documents, incomplete records and generic testimony from witnesses, according to judges who oversee the cases.”

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“Hedge funds that base investment decisions on economic trends are unwinding bets againstEuropean stocks (SXXP) at the fastest pace in three years, speculating policy makers will step up the fight against the debt crisis.

The degree by which macro funds are trailing the Euro Stoxx 50 Index (SX5E) is narrowing at the fastest rate since 2009, a sign managers are covering short sales by buying shares, according to data compiled by Bloomberg and JPMorgan Chase & Co. The proportion of shares on loan in the Stoxx Europe 600 Index, an indication of short interest, has fallen to 2.9 percent from 3.4 percent in May, data from London-based Markit show.”

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[youtube://http://www.youtube.com/watch?v=l91ISfcuzDw 450 300]

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The answer is up for debate, but as pointed out in this article the divergence has been going on for over a year.

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“(MoneyWatch) Pension funds across the country face massive deficits, estimated to be as much as $3 trillion. In an attempt to cover these deficits and keep their promises to retirees, many pension plans have dramatically increased their allocations to alternative investments. According to Wilshire Trust Universe Comparison Service, retirement systems with at least $1 billion in assets had raised their stake in real estate, private equity, and hedge funds from 10.7 percent in 2007 to 18.3 percent by the end of 2011.

The big question is whether such aiming at higher returns is worth the fees. The New York Times reported that the $24.5 billion South Carolina Retirement Systems paid $344 million in fees in 2011 alone, up from just $22 million in 2005. For those staggering fees, the system earned an annualized (and before-fees) return of 3.1 percent for the three years ending June 2011, though the system’s performance over the next six months made its three-year average rise above the national average.”

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Create your own pension management

“As some investors already understand – and so many more still don’t — mutual funds are expensive, tax-inefficient, outdated investment vehicles. And yet, more than half of American households own a mutual fund, helping power an $11.6 trillion industry.

That’s a market that isn’t going away anytime soon – but it’s certainly one that investors can and should be a lot smarter about if they choose to keep mutual funds in their portfolios. So here’s a basic question for any prospective buyer: Are the biggest and most popular mutual funds really worth your money?

The answer isn’t as easy to find as you might think: While Morningstar and many other companies provide ratings on mutual funds, they look at them in isolation of the greater marketplace. They analyze and compare mutual funds only to other mutual funds – which are often equally as flawed. They don’t consider “outside” options such as ETFs.”

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“Buy-and-hold strategies typically do perform well, but their success is predicated on buying and holding the correct assets. Having exposures to the correct market segments is called beta management, and investors tend to be very poor beta managers.

“Stocks for the long run” was the theme of the late 1990s and early-2000s, and investors were encouraged to buy-and-hold S&P 500 index funds. That seemed to make sense to them at the time because the US stock market had just finished one of its most successful performance decades in history. As a result, investors preferred US stocks. Unfortunately, US stocks subsequently underperformed.”

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Given all the confusion in predicting the market it is no wonder bond investors have plowed tons of money into safety. Here is an article to help you figure out stock market predictions and how you may proceed with your portfolio.

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“Despite calls from legendary investor Bill Gross that stocks have seen their day, and despite fears that investments aren’t safe due as evidenced by the technical glitch at Knight Capital that rattled markets, stocks are a necessity in a portfolio, said Jack Bogle, founder of The Vanguard Group.

“Knight Capital is meaningless for anyone in the market for the long haul,” Bogle told CNBC. “In fact, you’re probably in a mutual fund and you can pat yourself on the back for being smart.”

Mutual funds tend to spread risk across a basket of stocks and hedges.”

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“LONDON (Reuters) – The Libor system as a measure of interbank lending costs has ceased to work since the financial crisis and a fix needs to be found to support existing contracts based on the rate,Bank of England governor Mervyn King said on Wednesday.

Britain has set out to reform the key interest rate that was rigged by a number of banks, including Barclays , in a transatlantic scandal that is threatening to seriously damage London’s reputation as a financial center.”

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New York, August 07, 2012 — Historical evidence shows that the risk of re-default tends to remain high after sovereign distressed exchanges, Moody’s Investors Service says in a new report that analyzes the modern history of sovereign bond defaults and the haircuts imposed on investors.

The new report, entitled “Sovereign Defaults Series: Investor Losses in Modern-Era Sovereign Bond Restructurings,” is available on www.moodys.com. Moody’s subscribers can access this report via the link provided at the end of this press release.

“Thirty-seven percent of the 30 sovereign debt exchanges since 1997 were followed by further default events,” explains Elena Duggar, Moody’s Group Credit Officer for Sovereign Risk and author of the report. “These high rates of re-default after a distressed exchange in the sovereign sector are similar to the experience in the global corporate sector and explain why ratings often remain low, in the Caa-C rating range, following distressed exchanges.”

Since 1997, there have been 30 distressed exchanges on sovereign bonds, by 22 sovereign issuers. Moody’s new report pinpoints four key findings:

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Economic Measurement

I appreciate the opportunity to speak at a conference with the important theme of economic measurement. In many spheres of human endeavor, from science to business to education to economic policy, good decisions depend on good measurement. More subtly, what we decide to measure, or are able to measure, has important effects on the choices we make, since it is natural to focus on those objectives for which we can best estimate and document the effects of our decisions. One great pioneer in this subject area, of course, is Simon Kuznets, who was awarded the Nobel Prize in 1971 for his work on economic measurement, including the national income accounts. Over the years many economists have built on his work to further improve our ability to quantify aspects of economic activity and thus to improve economic policymaking and our understanding of how the economy works. The remarkably broad and ambitious research program of this conference and the impressive expertise that has been assembled illustrate the continued vitality of this field. Evolving technologies that allow economists to gather new types of data and to manipulate millions of data points are just one factor among several that are likely to transform the field in coming years.

As we think about new directions for economic measurement, we might start by reminding ourselves of the purpose of economics. Textbooks describe economics as the study of the allocation of scarce resources. That definition may indeed be the “what,” but it certainly is not the “why.” The ultimate purpose of economics, of course, is to understand and promote the enhancement of well-being. Economic measurement accordingly must encompass measures of well-being and its determinants.

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What kind of stupidity is this? That’s only about 5.7%, but staggered in such a way that the taxpayers will get absolutely hammered.

Cut the Keynesian horseshit and just raise taxes a bit.

This is a truly astounding story: San Diego’s Poway school district is paying $1 billion to borrow $105 million.

And it may not be alone in San Diego or the state paying loan shark rates.

According to a story in the Voice of San Diego, a mostly investigative online news site, the city really had no choice. It was either raise taxes or float what appeared to be just another bond to fix its schools.

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Will Europe get your money ? Bill Gross explains why Europe is doomed.

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