Monday, 22 September 2008

Alice's bubble wrap

NE will bounce back from credit crunch, claims minister

The credit crunch, as seen from the home of Northern Rock.

Treasury head vows to get UK through crisis

Does Darling mean that he will get us through to rockbottom?

Paulson and Bernanke got it wrong on Lehman

Judging by the reaction of markets, perhaps the bank was too big to fail.

When trust has been lost it is time to say prayers

I was hoping to read a religious perspective on the crisis, pointing to the power of prayer in times of great need. Instead, this journo complained that he paid too much for Madonna tickets.

"What do a Madonna concert and a banking crisis have in common? Not much, you might think. But, as I sat through an excruciating performance of "Borderline" in Wembley Stadium recently, I realised that Madonna and mammon go together rather well. The common link is trust (or its loss)."

Irish banks yanked on to mergers and takeovers merry-go-round

Did Irish banks think they were going to escape judgement?

Freeserve and ten years of boom and bust

This UK dot.com bubblefirm once had a larger market capitalization than British Airways.

Q&A: The US financial meltdown

The world made simple from Aljazeera.

No to Wall Street bailout! The socialist answer to the financial crisis

"We propose that the major banks and financial institutions be nationalized and turned into public utilities, operated under the democratic control of the working population."

Bush, Bernanke and Paulson are meeting the left half way here. The US mortgage market has been nationalized, along with the country's largest insurance company.

As for democratic control, Freddie and Fannie were always under Democratic party control.

Stocks tumble as Congress debates

"Wall Street weakens as investors look for clarity on the government's bank bailout plan. Oil spikes over $11 per barrel, while gold jumps over $44 per ounce."

The optimism of Friday is crushed by reality on Monday.

The Paulson Plan

Big picture explains the meaning of a trillion.

Paulson bailout

Another view from econobrowser

Dodd floats a rival to Paulson Plan: all the makings of a great Congressional shouting match

There has to be an alternative. However, I don' t think this is it.

We’re All Homeowners Now: 10 Reasons to be Cautious About This Housing Rescue Plan for Motherland USA.

From Dr. Housingbubble.

It could get much worse

A nice Baltimore Sun op-ed from Rolfe Winkler, who also write the option-armageddon blog.

2 comments:

Anonymous said...

"As for democratic control, Freddie and Fannie were always under Democratic party control."

Touche

Nick

Anonymous said...

On the present crisis:

1) What terrorism tried to do to the world financial system, and failed, by flying airplane airplanes into the twin towers of the World Trade Centre, the Fed may have achieved by by keeping interest rates far too low for far too long in the wake of 9/11, creating an orgy of speculation based on cheap credit.

2) The present violent up-and-down daily stock market swings are very reminiscent of market behaviour at the time of the 1929 crash, when according to historical descriptions people even resorted to crystal ball mediums to guess whether the next day would be up or down.

3) The current credit contraction is very like that which followed the 1929 crash.

4) The ridiculously low P/E ratios achieved in 2007 are only paralleled by those before the crash of 1929. This is really plain to see from the shape of the graphs - see:

http://www.crestmontresearch.com/pdfs/Stock%20Secular%20Explained.pdf

And Bernanke thinks he can solve this with a trillion or two?

No, no, no!

B. in C.