Reports early Monday from China suggest that a mass disturbance or riots may have broken out at a Foxconn factory in the Chinese city of Taiyuan.
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Comments »Monthly Archives: September 2012
The Greatest Trade Ever: Profiting from The Crash
It was the fall of 2007, financial markets were collapsing, and Wall Street firms were losing massive amounts of money, as if they were trying to give back a decade’s worth of profits in a few brutal months. An investor named John Paulson somehow was scoring huge profits. His winnings were so enormous they seemed unreal, even cartoonish. His firm, Paulson & Co., would make $15 billion in 2007.
Mr. Paulson’s personal cut would amount to nearly $4 billion, or more than $10 million a day. That was more than the 2007 earnings of J. K. Rowling, Oprah Winfrey and Tiger Woods put together. At one point in late 2007, a broker called to remind Mr. Paulson of a personal account worth $5 million, an account now so insignificant it had slipped his mind.
Mr. Paulson, known as J.P., bet that the housing market would collapse and risky mortgages would tumble in value. The moves put the fund manager from Queens, N.Y., alongside Warren Buffett, George Soros, and Bernard Baruch in Wall Street’s pantheon of traders. And as one rival fund manager later would say, with equal parts envy and respect, “Paulson’s not even a housing or mortgage guy…. Until this trade, he was run-of-the-mill, nothing special.”
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Comments »Documentary: Genetic Roulette
Cheers on your weekend!
http://www.youtube.com/watch?feature=player_embedded&v=odCSWY05u4Q
Comments »Market Update
Deficit Hawkman
[youtube://http://www.youtube.com/watch?v=EIifeECiZi8&feature=relmfu 450 300]
Comments »Civilian Stimulus Does Not Work
Very funny to this sissy civilian…
[youtube://http://www.youtube.com/watch?v=6fY6nKEKw08 450 300] Comments »Senate Republicans Block Veterans Job Corps
The Diminishing of ‘Animal Spirits’
“NEW HAVEN – Recent indications of a weakening global economy have led many people to wonder how pervasive poor economic performance will be in the coming years. Are we facing a long global slump, or possibly even a depression?
CommentsA fundamental problem in forecasting nowadays is that the ultimate causes of the slowdown are really psychological and sociological, and relate to fluctuating confidence and changing “animal spirits,” about which George Akerlof and I have written. We argue that such shifts reflect changing stories, epidemics of new narratives, and associated views of the world, which are difficult to quantify.
CommentsIn fact, most professional economists do not seem overly glum about the global economy’s prospects. For example, on September 6, the OECD issued an interim assessment on the near-term global outlook, written by Pier Carlo Padoan, that blandly reports “significant risks” on the horizon – the language of uncertainty itself.
CommentsThe problem is that the statistical models that comprise economists’ toolkit are best applied in normal times, so economists naturally like to describe the situation as normal. If the current slowdown is typical of other slowdowns in recent decades, then we can predict the same kind of recovery.”
Comments »Household Debt Rises at its Fastest Clip Since 2008, Expectations to Boost Economy
“WASHINGTON, Sept 20 (Reuters) – U.S. households increased their borrowing by the most since early 2008 in the second quarter, a development that could boost consumer spending and a lackluster economic recovery.
Household debt climbed $39.4 billion, the first gain in more than a year, to $13 trillion in the second quarter, the Federal Reserve said on Th ursday — just $2 trillion shy of the country’s total yearly economic output.
Economists said the rise in borrowing was an indication that the U.S. central bank’s accommodative monetary policy and easing financial market conditions were finally filtering through to the real economy.
“It’s encouraging news. With credit growth, one would expect to see an increase in spending and investment,” said Millan Mulraine, a senior economist at TD Securities in New York.
“While it may not necessarily be evident now, that is a sign that the recovery is likely to gain strength if this trend continues. The problem is, we are not getting strong job growth.” “
Comments »A Few Companies Announcing Dividend Hikes
Old Man Buffet’s Favorite Indicator Still Shows Modest Expansion in the Economy
” This week’s rail data conflicts with some recent reports from some major transport firms like Norfolk Southern and FedEx who both said end demand was softening. AAR reported a decline in carloads at -2.9%, but an increase in intermodal at 3.9%. We tend to favor intermodal as it has a better track record of forecasting expansion/contraction in the economy. The updated 10 week moving average dropped slightly to 4.8%, but remains near its highest levels of the year. The AAR has more details:”
Comments »Pinocchio Census Statistics
“(MoneyWatch) COMMENTARY It’s a good thing I write commentary for real people in the real working world and not to win voters over to the right or left. That simple fact allows me the latitude to actually be straightforward and genuine. Mainstream journalists should try it sometime.
That little bit of satire was brought to you by Thursday’s Associated Press “news” story, and I use that term loosely, indicating that the U.S. Census Bureau American Community Survey suggests that the economy has finally “bottomed out.”
Comments »The Long Term Picture on Unemployment
“MoneyWatch) America is facing an unemployment problem far more complex than what emerges in government jobless statistics. Changes in who the unemployed are and what has happened to them in the aftermath of the 2008 financial crisis could mean a starkly different economy even after jobs have returned.
Going just by the numbers. it might appear things are getting better, or at least not getting much worse. The unemployment rate dropped in August to 8.1 percent, from 8.3 percent. Yet the main reason for that decline was that many job-seekers gave up looking for work. A more accurate picture is visible in the four-week average of the number of people applying for unemployment benefits. The Labor Department said today that nearly 378,000 Americans applied for jobless aid last week, the highest level in nearly three months and the fifth-straight week that figure has increased. ”
Comments »Classic Oxymoron: U.S. to Seek Help From Banks to Stop Money Laundering
Just like letting the banks regulate themselves, the U.S. government is asking banks to help create a net against money laundering.
Comments »Gapping Up and Down This Morning
Gapping up
WMC +8.3%, IBN +6.2%, TTM +4.3%, KORS +3.4%, GRPN +2.5%, RIG +1.6%, SAP +1.5%, CTAS +1.2%,
PSO +2.1%, MO +1.3%, MA +1.3% , EMC +1% , EXPE +0.5%,
Gapping down
ASTX -4.2%, AI -2.3%, TIBX -2.2%, GT -1.3% , WLT -1%, RIMM -3.5%, VVUS -13.6% ,
GFI -1.2%, RIO -1.0%, HMY -0.7%, KBH -2%,
Comments »Upgrades and Downgrades This Morning
MO, AUO, AN, CMG, EMC, EXPE, FB, GT, GOOG, IBM, IP, JCP, LPL, LNKD, MA, MSI, NFLX, NTAP, VICL, YHOO,
Comments »In Play and On the Wires
Morgan Stanley: Fundamental Disconnect in the Markets, Were Not Buying This Turkey
“$MS continues to be one of the most bearish big shops around, and the latest Global Asset Strategy report from Gregory Peters drives that home.
The report is titled Fundamental Disconnect and the gist is that the market represents a battle right now between deteriorating fundamentals and central bank liquidity actions, and that the deteriorating fundamentals are likely to trump the easing in the end.
The general view on markets is summed up here: ”
Comments »Live Updates on Commentary by Hedge Fund Manager Ray Dalio
“It isn’t every day that Ray Dalio opens up to the world and speaks.
Dalio is widely considered the most powerful hedge fund manager in the world.
Perhaps because his secretive Connecticut firm, Bridgewater, is the largest in the world with $130 billion under management.
Also, perhaps, because he does what many money managers are unable to do — navigate the choppy waters of today’s market and consistently produce alpha.
So his appearance on CNBC’s Squawk Box this morning deserves your rapt attention.
Comments »
A New Study Shatters The Myth That Tax Breaks Spur Growth and Job Creation
“One economic theory has been repeated so often for so long in this country that it has become an accepted fact:
Tax cuts spur growth.
Most Americans have gotten so used to hearing this theory that they don’t even question it anymore.
One of our two Presidential candidates is so convinced of the theory that he has built his entire economic plan around it–despite the huge negative impact additional tax cuts would likely have on our debt and deficit.
But is the theory true? Do tax cuts really spur growth?
The answer appears to be “no.” ”
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