Felix Salmon

Counterparties

Liz Alderman provides the news context for Paul Krugman’s big magazine piece on Europe’s fiscal situation — NYT

Goldman’s Facebook plan falls apart

When the news came out that Goldman Sachs was orchestrating a private offering of Facebook shares at a $50 billion valuation, those shares overnight became an even hotter commodity than they had been up to that point. Check out the results of the periodic SecondMarket auctions: the three auctions in December, before the Goldman news was public, cleared at between $21.01 and $22.75 per share. The first auction after the Goldman news, by contrast, cleared at an all-time record of $28.26 per share — that’s a valuation of over $70 billion.

James Macdonald on US sovereign default

After I blogged Greg Ip’s post on the dangers of a US debt default if the debt ceiling isn’t raised, it became clear that we were very much lacking an expert take on the matter. So I asked James Macdonald, author of my favorite book about sovereign debt, if he might weigh in. Here’s what he replied:

Counterparties

Goldman’s “principles would be no help in decision making: they are a mixture of untruths, platitudes and boasts” — FT

Why is Seeking Alpha paying its contributors?

Seeking Alpha has finally started paying its contributors — but I’m not convinced that this is a welcome development.

Why Yunus is right about for-profit microfinance

Muhammad Yunus has a heartfelt NYT op-ed railing against for-profit financiers. When he founded Grameen Bank in Bangladesh, he writes, “I never imagined that one day microcredit would give rise to its own breed of loan sharks. But it has.”

JP Morgan threatens small depositors

Well done to Ron Lieber for calling bullshit on Chase’s PR spin:

Chase sure doesn’t sound happy. In a remarkable display of staying on message, it gave the same comment last week when The Wall Street Journal, CNN Money and the trade publication US Banker asked it to explain the reasoning for the new monthly fees.

The observer effect on muni ETFs

How much are municipal bonds worth? There are lots of indices purporting to follow the market, but these days all the attention is on exchange-traded funds, which are plunging alarmingly. The volatility in municipal ETFs has already caused Vanguard to pull its plans to issue three more such funds, and the total amount of money in them seems to be falling fast:

The global risk that is Davos

Jim Ledbetter reads the 50-page Davos global risks report so you don’t have to, and comes away with three and a half questions, all of which boil down to more or less the same thing: what if Davos is itself a global risk?