......and still another "false-bottom? Many still don't get it........Pssst........there is NO recovery. The toilet bowl of "life as we know it" is still emptying.
"Goldman Sachs Wrong on Economic Recovery, Macro Hedge Funds Say"
Quote:
SHANGHAI (Reuters) – General Motors (GM.UL) said on Sunday it has agreed to set up a light commercial vehicle production venture with major Chinese automaker FAW Group, with total investment of 2 billion yuan ($293 million).
The 50-50 joint venture, based in the northeast China city of Changchun in Jilin province, will make light-duty trucks and vans, GM said in a statement.
"For us in China, this is an important complement to the rest of our portfolio," Kevin Wale, president and managing director for GM's China operations, told reporters in a conference call.
"We are well established in passenger vehicles and mini commercial vehicles and we haven't had a presence in the truck segment. Adding a truck portfolio rounds that out."
The venture will use two existing FAW plants in Changchun and the city of Harbin, also in the northeast, with combined annual capacity of roughly 90,000 vehicles, Wale said.
A greenfield plant, currently under construction in Harbin, will add 100,000 units of capacity by the end of next year, he said.
Vehicles made at the venture will carry the FAW brand and will focus on supplying the China market, but they could be exported under a GM brand through the Detroit automaker's global network in the future, Wale said.
GM is making Buick, Chevrolet and Cadillac models at its flagship China venture with SAIC Motor Corp (600104.SS). It also makes minivans, pickup trucks and the Spark compact car in a three-way tie-up with SAIC and Liuzhou Wuling Automobile.
SAIC-GM-Wuling sold 87,925 vehicles in July, up 90.7 percent from a year earlier, helped by Beijing's stimulus initiatives to support the industry, including subsidies for buyers in rural areas.
GM, which now holds 34 percent of SAIC-GM-Wuling, has been seeking to raise its stake in the venture.
Domestic media reported earlier this month that GM had secured an initial deal to take over Liuzhou Wuling Auto's 15.9 percent stake for roughly 300 million yuan ($43.9 million).
Wale reiterated the U.S. automaker's interest in raising its stake in the venture but made no further comment on the issue.
($1=6.830 Yuan)
I'm so glad that we're paying for this. It would be one thing if there was going to be whole lot of return on the investment to the US but 50% stake in a venture with the Chinese isn't going to amount to a whole lot, at least I don't see it happening. $239 million is a lot of coin that could have been spent on R&D for a product that the American people want and could be built here. You know, to help our economy. Not to put on the tin foil hat but isn't the White House still in charge of GM? Is this something they are pushing?
If I read this wrong, someone please let me know, but, The Average job pay at GS is 700k. Now if all the posters average income on CR was 700k, would we not be a happy, partying group that could see no wrong in the economy, and would not want to change a thing......Oh Happy Days.
aig retreats are all in Croatia now; so that Benmosche can bill the taxpayer for the services.
from last thread: Tarullo wasn't really brought on for his economic prowess, but rather his expertise in banking regulation, which does seem to be out of Bernanke's grasp. for the most part, he is the Fed's point man in the new financial services reform legislation.
ICSC-Goldman Store Sales
Released on 9/1/2009 7:45:00 AM For wk8/29, 2009
Prior Actual
Store Sales - W/W change 0.6 % -0.5 %
Store Sales - Y/Y -0.2 % -0.7 %
Highlights
August chain-store sales ended up being a disappointment, according to ICSC-Goldman's same-store tally which fell 0.5 percent in the Aug. 29 week for a minus 0.7 percent year-on-year rate. The report down plays the impact of back-to-school calendar shifts and stresses the overall trend which it said is not improving. The report isn't making a call for month-to-month sales. Redbook is up next.
Definition
This weekly measure of comparable store sales at major retail chains, published by the International Council of Shopping Centers, is related to the general merchandise portion of retail sales. It accounts for roughly 10 percent of total retail sales. Why Investors Care
Basel Too (profile) wrote on Tue, 9/1/2009 - 6:19 am
aig retreats are all in Croatia now;...
Elbonia.
Edit restore clipped comments: from last thread: Tarullo wasn't really brought on for his economic prowess, but rather his expertise in banking regulation, which does seem to be out of Bernanke's grasp. for the most part, he is the Fed's point man in the new financial services reform legislation.
Agreed but notice how deftly this sidesteps the issue of whether to give the Fed more regulatory banking authority.
I didn't see this posted already so here for your gastronomic pain:
GM to form China venture, invest $293 million - Yahoo! News
If this is to capture a segment of the Chinese market, then fine; however, I suspect they'll be importing these before too long....
MaryAnn (profile) wrote on Tue, 9/1/2009 - 9:28 am
What did Presidents Kennedy and Lincoln have in common, it had to do with the Fed.
What JFK did was to create interest-free government money, backed up by the silver reserve, contrary to the Federal Reserve money, which is not backed up by anything as you will find out if you continue reading. He wanted to pay off the US debt this way. Apparently aware of the secret behind the Federal Reserve, he decided to go back and follow the Constitution. Of course, this was a very dangerous thing to do, because if he was allowed to continue, it could put the International bankers out of business in the long run. So this was even more serious than to reorganize the CIA.
Interestingly enough, soon after the assassination the interest-free money was taken out of circulation(1).
Kennedy signed a not very well known Executive Order, # 11110(2) in June of 1963, only five months before the assassination (also, click here to read ALL Executive Orders JFK wrote throughout his Presidency, ordered by numbers). This Order returned the power to issue currency to the government, without going through the Federal Reserve Bank. Kennedy gave the Treasury the permission to issue silver certificates against any silver bullion, silver, or standard silver dollars in the Treasury. In plain language this means that for every ounce of silver in the US Treasury vault, the government could let new money into circulation. JFK brought nearly $4.3 billion U.S. notes(3) out on the market. So, we can now clearly see that by signing this Executive Order, he was about to put the Federal Reserve Bank (and with them all the International Bankers) out of business. The Federal Reserve Notes would eventually not be in demand anymore, and by doing so, Mr. Kennedy probably also signed his own death warrant.
Here are some really mind-boggling synchronicities between Abraham Lincoln and John F. Kennedy. Just co-incidences? You tell me.
Abraham Lincoln was elected to Congress 1846
John F. Kennedy was elected to Congress in 1946
Lincoln was elected President in 1860
Kennedy was elected President in 1960
The name Lincoln contains seven letters
The name Kennedy contains seven letters
Lincoln's wife lost a child while living in the White House
Kennedy's wife lost a child while living in the White House
Lincoln was shot on a Friday
Kennedy was shot on a Friday
Lincoln was shot in the head
Kennedy was shot in the head
Lincoln's secretary's name was Kennedy
Kennedy's secretary's name was Lincoln
Lincoln's successor was named Johnson
Kennedy's successor was named Johnson
Andrew Johnson, who succeeded Lincoln, was born in 1808
Lyndon Johnson, who succeeded Kennedy, was born in 1908
John Wilkes Booth, who "assumingly" assassinated Lincoln, was born in 1839
Lee Harvey Oswald, who "assumingly" assassinated Kennedy, was born in 1939
Booth was known by his three names
Oswald was known by his three names
Booth's names are comprised of fifteen letters
Oswald's names are comprised of fifteen letters
Lincoln was shot at the theater named "Kennedy"
Kennedy was shot in a car called "Lincoln"
Booth ran from the theater and was caught in a warehouse
Oswald ran from a warehouse and was caught in a theater
Booth was assassinated before his trial
Oswald was assassinated before his trial
A week before Lincoln was shot, he was in Monroe, Maryland
A week before Kennedy was shot, he was in Marilyn Monroe.
Lincoln was well aware of what was happening, as shown in this letter:
"I see in the near future a crisis approaching. It unnerves me and causes me to tremble for the safety of my country. The money powers preys upon the nation in times of peace and conspires against it in times of adversity. It is more despotic than a monarchy, more insolent than autocracy, more selfish than bureaucracy. It denounces, as public enemies, all who question its methods or throw light upon its crimes. I have two great enemies, the Southern Army in front of me & the financial institutions at the rear, the latter is my greatest foe. Corporations have been enthroned, and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until the wealth is aggregated in the hands of a few, and the Republic is destroyed."
Mike in Long Island (profile) wrote on Tue, 9/1/2009 - 9:31 am
More green shoots!!
From this article on sales tax declines in New York State - oh the NYC area was down a mere 10% in sales tax collections - pikers.
NY State Sales Tax Collections - Green Shoots abound as back to school shopping is expected to save the day
"In terms of house prices, it would seem unlikely that a bear market bottom has been reached. Yes, the average house price is now back down around its long-term average of about 3.2 times average earnings, or only a little above it. But history suggests that markets don’t bottom at their average valuation: In fact, after such a huge excess to the upside, they overshoot on the downside.
The Case-Shiller 20-cities index is still 42% above its January 2000 level, having outpaced inflation during the last 9½ years. Yet January 2000 was not the bottom of a housing depression – far from it, in fact. That was actually close to the top of the dot-com bubble, when valuations of all assets were at all-time highs. So an average price over the whole country that – even now – remains 42% above the average price recorded at the very top of a huge economic boom does not seem like a market bottom to me."
Nah.... just reading all the MSM articles about about we're due for a correction, and September sux0rs, yada yada yada, and knowing how the market moves so as to cause the most people the most pain, I figured today looks to be a, uh, "good day to reload shorts".
"The principal enablers of our current difficulties were institutions that took on enormous risk by exploiting regulatory gaps between banks and the nonbank shadow financial system, and by using unregulated over-the-counter derivative contracts to develop volatile and potentially dangerous products. Consumers continue to face huge gaps in personal financial protections. We also lack a credible method for closing large financial institutions without inflicting severe collateral damage on the economy."
I'm liking her more and more; she obviously understands the problem better than most, or is at least willing to state it....
"REGULATORY GAPS" is the operative words. The more regulations that are brought in the greater the number of regulatory gaps. If her diagnosis of the problem is correct than the answer can't be more regulations. In fact I would argue it has to be fewer regulations and more outright bans. Force depository institutions to take all their trading activities, securitization etc and place them into non-regulated subsidiaries. Allow them to do whatever they want with as much or little capital as they like. The caveat- limit transactions the depository institutions can do with these entities. Prohibit the purchase of any asset backed securities in which a portion of the assets are not carried on the books of a regulated depository institution.
The non regulated entities deprived of the mothers milk ('liquidity') will be disciplined by the market.
One other change would be to require greater levels of equity in any asset back transactions. It seems to me that if the following transaction- pension fund deposits funds with bank which lends the money - requires capital than the transaction in which the pension fund lends money directly (via asset backed) should also require capital from a systemic risk perspective.
In a filing with the Securities and Exchange Commission, CIT said on Monday it provided a notice of continuance of a trigger period to the notes' holders. A trigger event, which the company didn't describe in the filing, has taken place, forcing CIT "to use commercially reasonable efforts" to execute an alternative payment mechanism to satisfy the Sept. 15 interest payment.
Even if they were just 60 year bonds, definitely couldn't foresee any systemic risk to a major economy over 60 years, right? I hope it was people playing with OPM.
LawyerLiz--At the hotel I work at our summer months improved from the really slower spring season. They were still down, but less down. Hmm, sound familiar? Actually we did very good over the winter, the best winter season in years according to my manager then it slowed a bit in spring, then a bit of a surge in summer. It is getting slower andslower though. Less business travelling and with school back in season less family travelling.
I figure we were positioned to catch the pancake so to speak. People traded down. travellers and businesses that may have picked up the tab for a marriott or hilton went down several price point rungs on the ladder and came to us. Now that the 'recovery' is showing how stillborn it is to the rest of theworld we are now going to be on the backside of the pancake. The hurtin' is just starting for real now. I equate it to traumatic injury to chronic condition. We had the traumatic crash/implosion, now the economy is coming to terms that the pain is going to linger a long long time. I just wish I could see the faces of the hotel guests as they see the room their new price-rung gets them. Gonna be some very scared and very itchy people wandering around. Around here the prices people want tend to be the old mom n pops and some are decent and some are...well...lacking.
What is helping though is the construction crews. I figure it may be a small shoot from the porkulus that has been spread around.
A Happy Morning to all, everybody.
Dang.
Liz- you beat me.
Kinda hard to rent a room without any income due to UE.
How could we spin this to be more positive?
A false bottom? Is that where Travis McGee stashed his cash?
Just luck.
Goldman Sachs Wrong on Economic Recovery, Macro Hedge Funds Say - Bloomberg.com
I thought that RevPar was consistantly down.
What improvement?
The view of the shipwreck is fantastic from the false bottom boat.
Maybe the "people" at GS really think that as GS goes, so
goes the nation.
They would be wrong.
......and still another "false-bottom? Many still don't get it........Pssst........there is NO recovery. The toilet bowl of "life as we know it" is still emptying.
"Goldman Sachs Wrong on Economic Recovery, Macro Hedge Funds Say"
Goldman Sachs Wrong on Economic Recovery, Macro Hedge Funds Say - Bloomberg.com
I didn't see this posted already so here for your gastronomic pain:
Yahoo! 404 - Page Not Found
Quote:
SHANGHAI (Reuters) – General Motors (GM.UL) said on Sunday it has agreed to set up a light commercial vehicle production venture with major Chinese automaker FAW Group, with total investment of 2 billion yuan ($293 million).
The 50-50 joint venture, based in the northeast China city of Changchun in Jilin province, will make light-duty trucks and vans, GM said in a statement.
"For us in China, this is an important complement to the rest of our portfolio," Kevin Wale, president and managing director for GM's China operations, told reporters in a conference call.
"We are well established in passenger vehicles and mini commercial vehicles and we haven't had a presence in the truck segment. Adding a truck portfolio rounds that out."
The venture will use two existing FAW plants in Changchun and the city of Harbin, also in the northeast, with combined annual capacity of roughly 90,000 vehicles, Wale said.
A greenfield plant, currently under construction in Harbin, will add 100,000 units of capacity by the end of next year, he said.
Vehicles made at the venture will carry the FAW brand and will focus on supplying the China market, but they could be exported under a GM brand through the Detroit automaker's global network in the future, Wale said.
GM is making Buick, Chevrolet and Cadillac models at its flagship China venture with SAIC Motor Corp (600104.SS). It also makes minivans, pickup trucks and the Spark compact car in a three-way tie-up with SAIC and Liuzhou Wuling Automobile.
SAIC-GM-Wuling sold 87,925 vehicles in July, up 90.7 percent from a year earlier, helped by Beijing's stimulus initiatives to support the industry, including subsidies for buyers in rural areas.
GM, which now holds 34 percent of SAIC-GM-Wuling, has been seeking to raise its stake in the venture.
Domestic media reported earlier this month that GM had secured an initial deal to take over Liuzhou Wuling Auto's 15.9 percent stake for roughly 300 million yuan ($43.9 million).
Wale reiterated the U.S. automaker's interest in raising its stake in the venture but made no further comment on the issue.
($1=6.830 Yuan)
I'm so glad that we're paying for this. It would be one thing if there was going to be whole lot of return on the investment to the US but 50% stake in a venture with the Chinese isn't going to amount to a whole lot, at least I don't see it happening. $239 million is a lot of coin that could have been spent on R&D for a product that the American people want and could be built here. You know, to help our economy. Not to put on the tin foil hat but isn't the White House still in charge of GM? Is this something they are pushing?
A few AIG leadership retreats should fix this.
C
wait a second.........do taxpayers still own a piece of the new GM?..........AND possibly a piece of China? WTF?
If I read this wrong, someone please let me know, but, The Average job pay at GS is 700k. Now if all the posters average income on CR was 700k, would we not be a happy, partying group that could see no wrong in the economy, and would not want to change a thing......Oh Happy Days.
aig retreats are all in Croatia now; so that Benmosche can bill the taxpayer for the services.
from last thread: Tarullo wasn't really brought on for his economic prowess, but rather his expertise in banking regulation, which does seem to be out of Bernanke's grasp. for the most part, he is the Fed's point man in the new financial services reform legislation.
ICSC-Goldman Store Sales
Released on 9/1/2009 7:45:00 AM For wk8/29, 2009
Prior Actual
Store Sales - W/W change 0.6 % -0.5 %
Store Sales - Y/Y -0.2 % -0.7 %
Highlights
August chain-store sales ended up being a disappointment, according to ICSC-Goldman's same-store tally which fell 0.5 percent in the Aug. 29 week for a minus 0.7 percent year-on-year rate. The report down plays the impact of back-to-school calendar shifts and stresses the overall trend which it said is not improving. The report isn't making a call for month-to-month sales. Redbook is up next.
Definition
This weekly measure of comparable store sales at major retail chains, published by the International Council of Shopping Centers, is related to the general merchandise portion of retail sales. It accounts for roughly 10 percent of total retail sales. Why Investors Care
Econoday Report: ICSC-Goldman Store Sales September 1, 2009
Nice recovery you got going here paper pushers.
Basel Too (profile) wrote on Tue, 9/1/2009 - 6:19 am
aig retreats are all in Croatia now;...
Elbonia.
Edit restore clipped comments:
from last thread: Tarullo wasn't really brought on for his economic prowess, but rather his expertise in banking regulation, which does seem to be out of Bernanke's grasp. for the most part, he is the Fed's point man in the new financial services reform legislation.
Agreed but notice how deftly this sidesteps the issue of whether to give the Fed more regulatory banking authority.
What did Presidents Kennedy and Lincoln have in common, it had to do with the Fed.
Another false bottom: { savings rate: only the top 1% is saving }
Guest Post: “The Savings Rate Has Recovered…if You Ignore the Bottom 99%” « naked capitalism
More green shoots!!
We're number 1 or tied for it in NY.
Long Island and the lower Hudson Valley tied for the largest regional declines in sales tax collections, of 10.1 percent.
From this article on sales tax declines in New York State - oh the NYC area was down a mere 10% in sales tax collections - pikers.
NY State Sales Tax Collections - Green Shoots abound as back to school shopping is expected to save the day
Off to the shrinking County of Miami-Dade.
The 10 biggest metro counties shrunk. Brevard,
the smallest only shrunk 0.1%.
shrank?
imploded?
Hey, nova, what did you want the other day?
As a bear today, I feel like quoting Han Solo: "I have a bad feeling about this".
nothing. just idle chatter.
"set up a light commercial vehicle production venture with major Chinese automaker FAW Group"
Just what the world needs - about a half a billion Chinese construction workers driving big, honking pickup trucks all over the roads.
Throttle down slowly so we can sooth the nerves of J6PK with false bottoms! If you can't hide it fake it!
shill (profile) wrote on Tue, 9/1/2009 - 9:11 am
I didn't see this posted already so here for your gastronomic pain:
GM to form China venture, invest $293 million - Yahoo! News
If this is to capture a segment of the Chinese market, then fine; however, I suspect they'll be importing these before too long....
With Toyota pulling the plug on the Cali plant (union) this is kind of interesting.
freep.com | | Detroit Free Press
What,
for your puts?
Eric - it's there already: boooinnnggg! Guess the bungee cord was shorter than the futures suggested.
C
MaryAnn (profile) wrote on Tue, 9/1/2009 - 9:28 am
What did Presidents Kennedy and Lincoln have in common, it had to do with the Fed.
What JFK did was to create interest-free government money, backed up by the silver reserve, contrary to the Federal Reserve money, which is not backed up by anything as you will find out if you continue reading. He wanted to pay off the US debt this way. Apparently aware of the secret behind the Federal Reserve, he decided to go back and follow the Constitution. Of course, this was a very dangerous thing to do, because if he was allowed to continue, it could put the International bankers out of business in the long run. So this was even more serious than to reorganize the CIA.
Interestingly enough, soon after the assassination the interest-free money was taken out of circulation(1).
Kennedy signed a not very well known Executive Order, # 11110(2) in June of 1963, only five months before the assassination (also, click here to read ALL Executive Orders JFK wrote throughout his Presidency, ordered by numbers). This Order returned the power to issue currency to the government, without going through the Federal Reserve Bank. Kennedy gave the Treasury the permission to issue silver certificates against any silver bullion, silver, or standard silver dollars in the Treasury. In plain language this means that for every ounce of silver in the US Treasury vault, the government could let new money into circulation. JFK brought nearly $4.3 billion U.S. notes(3) out on the market. So, we can now clearly see that by signing this Executive Order, he was about to put the Federal Reserve Bank (and with them all the International Bankers) out of business. The Federal Reserve Notes would eventually not be in demand anymore, and by doing so, Mr. Kennedy probably also signed his own death warrant.
Here are some really mind-boggling synchronicities between Abraham Lincoln and John F. Kennedy. Just co-incidences? You tell me.
Abraham Lincoln was elected to Congress 1846
John F. Kennedy was elected to Congress in 1946
Lincoln was elected President in 1860
Kennedy was elected President in 1960
The name Lincoln contains seven letters
The name Kennedy contains seven letters
Lincoln's wife lost a child while living in the White House
Kennedy's wife lost a child while living in the White House
Lincoln was shot on a Friday
Kennedy was shot on a Friday
Lincoln was shot in the head
Kennedy was shot in the head
Lincoln's secretary's name was Kennedy
Kennedy's secretary's name was Lincoln
Lincoln's successor was named Johnson
Kennedy's successor was named Johnson
Andrew Johnson, who succeeded Lincoln, was born in 1808
Lyndon Johnson, who succeeded Kennedy, was born in 1908
John Wilkes Booth, who "assumingly" assassinated Lincoln, was born in 1839
Lee Harvey Oswald, who "assumingly" assassinated Kennedy, was born in 1939
Booth was known by his three names
Oswald was known by his three names
Booth's names are comprised of fifteen letters
Oswald's names are comprised of fifteen letters
Lincoln was shot at the theater named "Kennedy"
Kennedy was shot in a car called "Lincoln"
Booth ran from the theater and was caught in a warehouse
Oswald ran from a warehouse and was caught in a theater
Booth was assassinated before his trial
Oswald was assassinated before his trial
A week before Lincoln was shot, he was in Monroe, Maryland
A week before Kennedy was shot, he was in Marilyn Monroe.
Lincoln was well aware of what was happening, as shown in this letter:
"I see in the near future a crisis approaching. It unnerves me and causes me to tremble for the safety of my country. The money powers preys upon the nation in times of peace and conspires against it in times of adversity. It is more despotic than a monarchy, more insolent than autocracy, more selfish than bureaucracy. It denounces, as public enemies, all who question its methods or throw light upon its crimes. I have two great enemies, the Southern Army in front of me & the financial institutions at the rear, the latter is my greatest foe. Corporations have been enthroned, and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until the wealth is aggregated in the hands of a few, and the Republic is destroyed."
From:http://blogs.myspace.com/index.cfm?fuseaction=blog.view&friendId=88165716&blogId=490859605
Mike in Long Island (profile) wrote on Tue, 9/1/2009 - 9:31 am
More green shoots!!
From this article on sales tax declines in New York State - oh the NYC area was down a mere 10% in sales tax collections - pikers.
NY State Sales Tax Collections - Green Shoots abound as back to school shopping is expected to save the day
Back To School? Where? - The Market Ticker
Another false bottom { housing prices }
"In terms of house prices, it would seem unlikely that a bear market bottom has been reached. Yes, the average house price is now back down around its long-term average of about 3.2 times average earnings, or only a little above it. But history suggests that markets don’t bottom at their average valuation: In fact, after such a huge excess to the upside, they overshoot on the downside.
The Case-Shiller 20-cities index is still 42% above its January 2000 level, having outpaced inflation during the last 9½ years. Yet January 2000 was not the bottom of a housing depression – far from it, in fact. That was actually close to the top of the dot-com bubble, when valuations of all assets were at all-time highs. So an average price over the whole country that – even now – remains 42% above the average price recorded at the very top of a huge economic boom does not seem like a market bottom to me."
The U.S. Housing Market's False Dawn
What, Sad for your puts?
Nah.... just reading all the MSM articles about about we're due for a correction, and September sux0rs, yada yada yada, and knowing how the market moves so as to cause the most people the most pain, I figured today looks to be a, uh, "good day to reload shorts".
Gosh, that's quite a slope upwards on the Dow.
C
Nice OP_ED by Sheila:
OP-ED CONTRIBUTOR; The Case Against a Super-Regulator - NY Times
"The principal enablers of our current difficulties were institutions that took on enormous risk by exploiting regulatory gaps between banks and the nonbank shadow financial system, and by using unregulated over-the-counter derivative contracts to develop volatile and potentially dangerous products. Consumers continue to face huge gaps in personal financial protections. We also lack a credible method for closing large financial institutions without inflicting severe collateral damage on the economy."
I'm liking her more and more; she obviously understands the problem better than most, or is at least willing to state it....
"REGULATORY GAPS" is the operative words. The more regulations that are brought in the greater the number of regulatory gaps. If her diagnosis of the problem is correct than the answer can't be more regulations. In fact I would argue it has to be fewer regulations and more outright bans. Force depository institutions to take all their trading activities, securitization etc and place them into non-regulated subsidiaries. Allow them to do whatever they want with as much or little capital as they like. The caveat- limit transactions the depository institutions can do with these entities. Prohibit the purchase of any asset backed securities in which a portion of the assets are not carried on the books of a regulated depository institution.
The non regulated entities deprived of the mothers milk ('liquidity') will be disciplined by the market.
One other change would be to require greater levels of equity in any asset back transactions. It seems to me that if the following transaction- pension fund deposits funds with bank which lends the money - requires capital than the transaction in which the pension fund lends money directly (via asset backed) should also require capital from a systemic risk perspective.
10:01a
U.S. Aug. ISM above consensus 50.5%
10:01a
U.S. Aug. ISM factory index 52.9% vs. 48.9% July
News Viewer - MarketWatch
LOL. 2067!
CIT Will Defer an Interest Payment - WSJ.com
CIT Group Inc. said that it won't be able to make a Sept. 15 interest payment required on notes due in 2067.
In a filing with the Securities and Exchange Commission, CIT said on Monday it provided a notice of continuance of a trigger period to the notes' holders. A trigger event, which the company didn't describe in the filing, has taken place, forcing CIT "to use commercially reasonable efforts" to execute an alternative payment mechanism to satisfy the Sept. 15 interest payment.
We have factories?
When did they issue those? Were they century bonds first issued in 1967 or merely 60 year bonds issued in those heady days of 2007?
My guess is the later.
LOL. 2067!
Even if they were just 60 year bonds, definitely couldn't foresee any systemic risk to a major economy over 60 years, right? I hope it was people playing with OPM.
shill (profile) wrote on Tue, 9/1/2009 - 7:04 am
We have factories?
We have "manufacturing capacity" on the books as an accounting convenience for the bean counters.
CIT Group Inc. said that it won't be able to make a Sept. 15 interest payment required on notes due in 2067.
TAKE THE MARKET ON THAT!
Everyone else is living rent-free, why shouldn't they?
A week before Kennedy was shot, he was in Marilyn Monroe.
LOL. Yeah, but Bobby paid her back by getting his mob friends to off her.
LawyerLiz--At the hotel I work at our summer months improved from the really slower spring season. They were still down, but less down. Hmm, sound familiar? Actually we did very good over the winter, the best winter season in years according to my manager then it slowed a bit in spring, then a bit of a surge in summer. It is getting slower andslower though. Less business travelling and with school back in season less family travelling.
I figure we were positioned to catch the pancake so to speak. People traded down. travellers and businesses that may have picked up the tab for a marriott or hilton went down several price point rungs on the ladder and came to us. Now that the 'recovery' is showing how stillborn it is to the rest of theworld we are now going to be on the backside of the pancake. The hurtin' is just starting for real now. I equate it to traumatic injury to chronic condition. We had the traumatic crash/implosion, now the economy is coming to terms that the pain is going to linger a long long time. I just wish I could see the faces of the hotel guests as they see the room their new price-rung gets them. Gonna be some very scared and very itchy people wandering around. Around here the prices people want tend to be the old mom n pops and some are decent and some are...well...lacking.
What is helping though is the construction crews. I figure it may be a small shoot from the porkulus that has been spread around.
nah, it was Other People all right,
but they were playing with Our Money...