Bailout

Negative equity datapoint of the day

Posted on May 12, 2010
Negative equity datapoint of the day

Should you be trying to pick stocks?

Posted on May 12, 2010
Tadas Viskantas reckons that we might be entering a "golden age of stock picking". Why?

Counterparties

Posted on May 11, 2010
The winner's curse implies that Labour and the Lib Dems should allow a Tory minority government making huge spending cuts -- Guardian

Nassim Taleb didn?t cause the crash

Posted on May 11, 2010
Of all the silly theories about the cause of Thursday's stock-market plunge, I'm not entirely sure why the WSJ has decided to give particular credence to the idea that it can all be traced back to a single $7.5 million trade for 50,000 options contracts...

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Why Greece might not default any time soon

Posted on May 11, 2010
Anna Gelpern has the smartest take on why Greece won't default, which kicks off with this powerful truth:

Gold and the worry trade

Posted on May 11, 2010
As Paul Krugman notes, the euro/dollar exchange rate is probably a better place to look, and that's now back down below 1.27, after trading at 1.50 as recently as December. ... Which, just as much as recent stock market volatility, is a pretty clear indication that there's still a lot of worry out there, trillion-dollar eurozone bailout plans notwithstanding.

Real income datapoint of the day

Posted on May 11, 2010
Manhattan incomes rose by 35.5%, in real terms, between 2000 and 2008. Manhattan, Kansas, that is. Meanwhile, in much more educated and vibrant cities like Raleigh and Austin, real incomes fell substantially. What's going on here? Mike Mandel looks at the numbers:

Europe: It?s more than just government debt

Posted on May 11, 2010
Ronan Lyons is unimpressed by the now-viral NYT graphic showing the web of debt within Europe. It's particularly unfair to his native Ireland, he says:

Counterparties

Posted on May 10, 2010
My op-ed on Hollywood box-office futures -- NYT

The EU bailout: Too much, too late

Posted on May 10, 2010
Is the massive EU bailout a case of "too much, too late"? At $1 trillion, give or take (depending on the highly-uncertain value of the euro), it's certainly enormous: Mohamed El-Erian calls it "a completely new level and dimension" in terms of European policy response...

Why volatility means you should sell stocks

Posted on May 10, 2010
Many thanks to the guys at HuffPo, who splashed my video from Friday all over their front page this weekend: the resulting post has now received well over 2,500 comments, and there's even now a "Felix Salmon Investment Advice" tag over at HuffPo, which is scary.

Waiting for details on the trillion-dollar rescue

Posted on May 10, 2010
It's not all that easy to tell, but it looks very much as though most of today's market rally is a function of the ECB deciding that it can start buying bonds in the secondary market after all. The trillion-dollar announcement from the EU looks big and grand, but ultimately is so vague that few market participants would place much stock in it.

It?s still a good idea to sell stocks

Posted on May 10, 2010
If markets can go up a lot, they can go down a lot. And when an asset class gets more volatile, it gets riskier. Your risk appetite hasn't changed over the past couple of months, so your appetite for stocks should really have gone down.

Don?t lend money to friends, EU edition

Posted on May 10, 2010
If you borrow a lot of money from a friend, or lend a lot of money to a friend, then ultimately your friendship is likely to suffer. The same dynamic is now at work in the EU.

The Moody?s scandal takes its toll

Posted on May 10, 2010
Can the SEC just release, daily, the names of all the companies to whom it has sent Wells notices? Moody's stock has plunged today after it disclosed late on Friday that it received a Wells Notice on March 18. Mish says that the receipt of the notice "is a significant event that Moody's failed to report to shareholders", but Reuters is talking about "relatively short six-week lag in disclosing that it got a Wells Notice".

Payday lenders go to Washington

Posted on May 10, 2010
Ylan Mui reports on the "Hill Blitz" orchestrated last week by payday lenders, aggrieved that they might at last face federal regulation:

European bond chart of the day

Posted on May 09, 2010
Thanks to Johannes Bruder of Hamburg University for sending me this intriguing chart:

Counterparties

Posted on May 08, 2010
Raj Rajaratnam's defense docs -- Raj Defense

Jobs come back, along with unemployment

Posted on May 07, 2010
The payrolls report this morning was good: it feels churlish to throw cold water on the news that 290,000 more people are working now than a month ago.

Counterparties

Posted on May 07, 2010
Update on tape revelations of stormy Copenhagen leader smackdown -- now with Obama Admin response -- NYT

Bite-sized video

Posted on May 07, 2010
I'm experimenting with adding a bit of video to this here blog, do you think it's a good idea? Here's a couple of bite-sized snacks I recorded this afternoon: the first one's on why it's a good idea to get out of the stock market right now, and the second one's on Greece, and how it's a harbinger of other sovereign debt crises to come.

El-Erian on Greece and its consequences

Posted on May 07, 2010
Mohamed El-Erian is fast becoming the biggest and most important bear in the world when it comes to the consequences of the Greece crisis:

Deconstructing the crash

Posted on May 07, 2010
Bloomberg's Nina Mehta and Chris Nagi have an excellent explanation of the role of fragmented exchanges in yesterday's market crash. The upshot is that something which was meant to make trading safer in fact made it more dangerous, just like portfolio insurance in 1987...

Counterparties

Posted on May 06, 2010
Goldman's outside directors got an average of $298,000 each in 2008. How much would a non-executive chairman make? -- Reuters

Why invest retirement funds in stocks?

Posted on May 06, 2010
I love Eddy Elfenbein's response to Scott Adams, who thinks that a good simple retirement portfolio can be wholly made up of just two ETFs, one domestic and one emerging-market.

How a market crashes

Posted on May 06, 2010
How can the market go, on a random Thursday afternoon, completely insane? The story which is emerging centers on old, boring Procter & Gamble, as can be seen in the PG chart from this afternoon.

Volatility returns

Posted on May 06, 2010
Ah, volatility. Suddenly, at 2:30pm this afternoon, the US stock market decided it was going to fall off a cliff, and the Dow promptly proceeded to drop about 700 points in the space of mere minutes, before bouncing back up. This is pure market craziness: if any journalist tries to blame "worries about Greece" or anything like that, ignore them -- insofar as there's a simple explanation, it's probably something to do with a dodgy feed on Procter & Gamble's stock price, which fed directly into the Dow, and caused a brief spell of utter panic.

The Goldman Wells puzzle

Posted on May 06, 2010
I can understand the trading-desk mentality which went into the Abacus deal. What puzzles me more is Goldman's incredible secrecy when it came to disclosure that it had received a Wells notice:

Counterparties

Posted on May 05, 2010
Euro now below $1.30, Greece 2yr debt still at 14%. Crisis not remotely averted yet -- Reuters

Reasons to buy Newsweek

Posted on May 05, 2010
Ken Layne has by far the funniest and most cutting reaction to the Newsweek news, but it's Jeff Bercovici who nails the conventional wisdom:

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