Double Dip Est Arrivé: Institutional Risk Analyst
by ilene - July 9th, 2010 11:22 am
Double Dip Est Arrivé: Institutional Risk Analyst
Courtesy of JESSE’S CAFÉ AMÉRICAIN
Chris Whalen of Institutional Risk Analyst has this interesting interview on CNBC, sent to me by a reader.
I have not watched that television channel in some years, finding their shallowness and hypocrisy too much to bear. Of course my refuge, Bloomberg Television, has lowered its standards so much, with spokesmodels and smirking chimps, that it may have achieved parity. Are Cramer, Kudlow and Kernan still kicking? Remarkable.
This is an interesting exposition of the currency wars, and the pandering to the big financial institutions by the Fed over the past fifteen years, ultimately at the expense of the real economy in the distortions and misallocation of capital which the financial engineers have fostered.
Here is the interview with Jim Rickards to which Chris alludes.
Chris Whalen sounds like me. I wonder if he can cook?
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The Six Hundred Forty One Million Dollar Carcass
by ilene - March 16th, 2010 7:25 pm
Joshua M Brown, The Reformed Broker, happy to spread the wealth around…
The Six Hundred Forty One Million Dollar Carcass
Buried in a story about how what’s left of Lehman Brothers is looking to emerge from Chapter 11, there was an astounding statistic that I’ll ask you to savor like the last suckle of a Werther’s Original…
From Reuters:
Lehman has paid $641.9 million in U.S. professional fees since it filed for bankruptcy, according to a January 2010 report.
Hilarious. Lehman Brothers was the biggest bankruptcy filing in history – so why shouldn’t the "clean up effort" be the biggest legal and advisory bonanza in history as well?
Everyone got involved – restructuring firms, bankruptcy trustees, law firms of every stripe, sushi chefs, PR firms, jugglers and stilt-walkers and fire eaters, consultants, advisors, tax experts, witch doctors, real estate appraisers, hairdressers, financial engineers, secretaries, bassoonists etc.
What a Norman Rockwell moment for America – just picture this hideous tableaux – bespoke-suited and bespectacled millionaires sifting through the carrion offal of disgraced-but-still-filthy-rich billionaires while the rest of American Business looks on without a line of credit or a paying customer in sight.
Just like Walt Disney imagineered it for Main Street USA.
$641 million in fees generated during Chapter 11? Hell, that’s a stimulus plan in and of itself! Who can we bring to its knees next quarter? Can we incinerate another hundred billion dollar company so that the bourgeoisie can snort those ashes off a conference table, too?
Someone’s gotta do it, so I’m not mad at the restructo-vulture complex. In fact, to the contrary, I’m glad to see that we haven’t found a way to offshore the jobs of corporate undertakers just yet.
Still got one booming industry left, then. Cool.
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Finance’s Euphoria: The Epilogue — What Record High Dollar Volume of Trading Says About Confidence
by Chart School - November 11th, 2009 11:55 am
Finance’s Euphoria: The Epilogue — What Record High Dollar Volume of Trading Says About Confidence
The following article was adapted from the November 2009 Elliott Wave Financial Forecast and reprinted with permission here.
By Steve Hochberg and Pete Kendall, courtesy of Elliott Wave International
When Wall Street’s total value of assets rose to a “mind-boggling 36.6 percent of GDP” in late 2006, The Elliott Wave Financial Forecast published a chart of U.S. financial assets literally rising off the page.
The Financial Forecast observed that financial engineers had “found a new object of investor affections—themselves” and asserted that “the financial industry’s position so close to the center of the mania can mean only one thing; it is only a matter of time” before a massive reversal grabbed hold. Financial indexes hit their all-time peak within a matter of weeks, in February. The major stock indexes joined the topping process in October 2007 and in December 2007 the economy followed. Subscribers will recall that one of the most important clues to the unfolding disaster was the level of financial exuberance relative to the fundamental economic performance.
This chart of the value of U.S. trading volume (courtesy of Alan Newman at www.cross-currents.net) reveals that the imbalance is far from corrected.
Incredibly, total dollar trading volume is even higher now than it was in 2007 when the economy was humming along. In June 2008, dollar trading volume also defied an initial thrust lower in stocks and the economy, eliciting this comment from the Financial Forecast:
The chart of dollar trading relative to GDP shows how much more willing investors are to trade shares in companies that operate in an economic environment that is anemic compared to that of the mid-1960s. A basic implication of the Wave Principle is that the public will always show up at the end of a rally, just in time to get clobbered. This chart shows that it is happening in a big, big way now because the market is at the precipice of the biggest decline in a long, long time.
Total dollar volume continues to rise despite further fundamental financial deterioration. Yes, GDP experienced a one-quarter, clunker-aided uptick of 3.5 percent in the third quarter. But the economy is in far worse shape than it was when we made the above statement. In fact, its recent performance on top of the decades-long economic underperformance…
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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...
Ilene is editor and affiliate program
coordinator for PSW.