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18 April 2011

The Downside to ‘Trust Us, We Can Regulate Ourselves’

One of the better pieces I’ve seen on CNN since, well, the first Gulf War coverage. Goldman Sachs was the number one private campaign contributor to Barack Obama’s presidential election campaign. It’s one of the single biggest contributors to both parties in Congress. So it’s a rare event when a establishment politician like Carl Levin [...]

11 March 2011

Real Estate vs. Gold Ratio: Getting Closer to 1980s Low

Image Credit: Chart of the Day Being a chartporn aficionado, it’s hard to not to look at such a chart and wonder if precious metals and real estate markets from the late 1970s/early 1980s will do an encore. Real estate still has a long way to fall, in my opinion as well as many others [...]

28 February 2011

Michael Lewis on GPS: A Remarkable Return to ‘Normalcy’

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Well said by Michael Lewis on Fareed Zakaria’s GPS… If you had told me in early 2009 that all these big Wall Street firms would be back even bigger and paying big bonuses and essentially socializing their losses but their gains privatized and that the American people put up with it — that’s the incredible [...]

18 February 2011

Just How Far In Debt is the USA?

Fairly sobering stuff when forced to visualize the amount of money we don’t have to cover the promises we’ve already made. Guess no one told the “fiscal conservatives” in Congress that it would take the entire world’s GDP plus a few trillion more to meet our total debt and unfunded obligations. (Might help to disengage [...]

15 February 2011

How Capitalism Works: Everybody Owes Everybody Else

One of the upsides to having insomnia is you watch all sorts of things you wouldn’t ordinarily watch. Case in point, this humorous quote from an old James Cagney flick One Two Three filmed during the Cold War which couldn’t have sarcastically summed up the Achilles Heel of capitalism and forecasted the financial crisis any [...]

12 February 2011

Michael Lewis: California’s Debt Crisis is Topic of Next Article

One would have thought Michael Lewis’ The Big Short would be the pinnacle of financial post-mortem exams. But his latest masterpiece on Ireland’s financial house of cards poignantly summarizes the “Perfect Storm” effect of behavioral economics: unregulated financial markets, greed for making money trumps fear of losing money, and good old fashioned herd psychology. Most [...]

11 February 2011

Post Financial Crisis Retracements: Buy & Hold Investors Making Their Money Back

In 2007, the financial crisis and impending stock market crash was nothing but a bearish prognostication. To the chagrin of many, once the stock market was in total free fall, the Feds stepped in with tons upon tons of money to prop up the market, sell billions of dollars in USTs on a weekly basis, [...]

6 February 2011

The Irish Bubble: Can’t Spell ‘Confidence’ without ‘Con’

I speak quite a bit about the dark side of investor “confidence”, and no where is there a better example on the fallout from manipulating investor psychology than the latest Vanity Fair piece by Michael Lewis on the Irish financial crisis. The endless flow of cheap foreign money had teased a new trait out of [...]

2 February 2011

Long “The Nickel”: Michael Lewis on The Colbert Report

I’ve got just one word for you… just one word… plastics nickels. Nickels are the next bubble: the metal content is now worth $0.07. If you melt it down, it’s worth 7 cents. One of the characters who made a fortune betting on the financial collapse of the system, is buying nickels. So he rings [...]

24 January 2011

Take a Guess Who is Paying Fannie & Freddie’s Legal Fees

Only in America! Not only did taxpayers bail out Fannie and Freddie and overpay (still overpaying) the executives, but we’re also paying their legal bills. Kinda like paying the Captain of the Titantic an overly generous salary for ramming the iceberg, rescuing him from certain death, then paying his legal bills after the families of [...]

22 January 2011

P2P Lending Investors Beware: Government Layoffs & State Bankruptcy Risk Increasing

Some time ago, I mentioned that P2P lending investors should no longer believe that a peer to peer lending loan to federal or state government employee is a “sure thing” or that government employees can never be laid off. Since then, lots of supporting evidence has manifested. Not only from state governments eying bankruptcy court [...]

16 January 2011

Let Them Eat Credit: Debt as the ‘Pacifier’ of Income Inequality

Fascinating interview from NPR’s Deep Reads with Raghu Rajan, University of Chicago professor, former chief economist for the IMF, and author of Fault Lines: How Hidden Fractures Still Threaten the World Economy, and the cold shoulders he received after predicting the financial crisis in 2005 at a conference where the main objective was to praise [...]

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