Commentaries

Government weighed down by bad mortgages

November 12, 2009

The Federal Housing Administration – the U.S. agency that actually enjoys full faith and credit of the government – is in quite a pickle. Reuters reporting that its capital reserves stand at a scant 0.53 percent, below the 2 percent regulatory minimum and without spitting distance of the “help me” threshold.

from Rolfe Winkler:

TARP may pay down debt

November 12, 2009

From Deborah Solomon and Jonathan Weisman at WSJ:

The administration wants to keep some of the unspent [TARP] funds available for emergencies, but is considering setting aside a chunk for debt reduction, according to people familiar with the matter. It is also expected to lower the projected long-term cost of the program -- the amount it expects to lose -- to as little as $200 billion from $341 billion estimated in August.

A camel for EU president?

By Paul Taylor
November 12, 2009

camelsA camel, says an old Middle East joke, is a horse designed by a committee.

The European Union is in danger of getting camels for its two new leadership positions — president of the European Council and foreign policy High Representative — because of the dysfunctional appointment process created by the Lisbon Treaty.

from Rolfe Winkler:

Palin speech a syntactical comedy of errors

November 11, 2009

And now for something completely different. Jonathan Martin covered a speech by Sarah Palin for Politico last week. Comedy gold.

Do Galleon’s tentacles reach to Chicago?

November 11, 2009

It appears Chicago-based Balyasny Asset Management may have been drawn into the Galleon insider trading scandal.

Reasons to be cheerful

November 11, 2009

By John M. Berry

John M. Berry, who has covered the economy for four decades for the Washington Post and other publications, is a guest columnist.

from Rolfe Winkler:

Rosenberg: Unemployment headed to 12-13%….

November 11, 2009

...but that doesn't mean the overall employment picture will get a lot worse.

From today's "Breakfast with Dave" e-mail:

There are serious structural issues undermining the U.S. labour market as companies continue to adjust their order books, production schedules and staffing requirements to a semi-permanently impaired credit backdrop. The bottom line is that the level of credit per unit of GDP is going to be much, much lower in the future than has been the case in the last two decades. While we may be getting close to a bottom in terms of employment, the jobless rate is very likely going to be climbing much further in the future due to the secular dynamics within the labour market.

Triple-A rated tripe from the ratings agencies

November 11, 2009

How the ratings agencies must love Stephen Lewis, the lugubrious economics guru from Monument Securities. He’s spotted that two views make a market, even in the whacky world of these bodies who must judge how creditworthy borrowers really are.

from Rolfe Winkler:

Afternoon Links 11-10

November 10, 2009

Mishkin defends bubbles (Yves Smith) Yves tears apart former Fed Governor Frederic Mishkin's op-ed in FT, for good reason.

VW prefs don’t deserve DAX treatment

November 10, 2009

Volkswagen’s merger with Porsche has exposed a bizzare quirk in the Deutsche Boerse’s index requirements, which could allow the carmaker’s preference shares to replace its ordinaries in the flagship DAX equity index.