Speaking of banks...
Banks' fourth quarter trading revenue falls 66 percent - Yahoo! Finance

Didn't Meredith say their profits would be down because the easy money had been made last year?

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Puerto Rico translates as: Rich Port

And it was quite pirate-adjacent back in the day...

from the article I linked:

"JPMorgan Chase & Co (JPM - News), Bank of America Corp (BAC - News), Goldman Sachs, Citigroup Inc (NYSE:C - News) and Wells Fargo & Co (WFC - News), have the largest derivatives exposures of U.S. commercial banks.

As of December 31, these banks' notional derivative exposures stood at $78.55 trillion, $44.32 trillion, $41.6 trillion, $37.55 trillion and $4.18 trillion, respectively, the regulator said.

JPMorgan, Bank of America, Goldman Sachs, Morgan Stanley and Citi had the largest derivative exposures of all holding companies, at $78.66 trillion, $72.53 trillion, $48.85 trillion, $41.51 trillion and $39.35 trillion, respectively.

Of the large banks, Goldman again got the largest overall boost from its trading revenue, which represented 72 percent of the bank's gross revenue in the quarter, the OCC said.

JPMorgan and Bank of America's trading revenue represented 3 percent and 2 percent, respectively, of their gross revenue while Citigroup recorded a loss of 12 percent in gross revenue from its trading revenue."

You have to love that Citi managed to lose 12 percent when was raking it in. Well done.

Robert Mundell, also a central bank of Sweden Nobel award winner in Economic "Sciences", disagrees with Paul Krugman on China:

Asked about the valuation of the Chinese yuan after American lawmakers urged the Obama administration to step up pressure on China to let its currency appreciate, Mundell said that “it’s a big mistake to make the exchange rate the issue.”

“It would be politically unstable for China if they had a very large appreciation,” he said. “It would be very dangerous. The U.S. needs to get off that, onto the issue of correcting” global trade and financial imbalances.

Mundell suggested that countries representing the world’s five biggest currencies -- the dollar, euro, British pound, yen and yuan -- should stop talking about exchange rates and meet to “decide what are the global imbalances that need to be corrected and what role should exchange rates play.”

IMF Must Only Be Greece’s ‘Last Resort,’ Mundell Says (Update2) - BusinessWeek

Plain sense from the older man beats "careful economic analysis" every time.

Dick Bove: Housing Market Will Fall 10% 15% When Fed Stops Subsidizing Home Prices: Tech Ticker, Yahoo! Finance

"Over the longer term, though, we'll begin to find out where house prices would be if the housing market were less subsidized. And Dick Bove expects that that level is 10%-15% below today's prices."

Parma, OH!? Drew Carey's bank?

I must have a bad internet connection ... that Bove comment makes sense.

There's a lawyers v. doctors lesson in there but I'll wait until you are feeling better.

$20 for a couple of tylenols being the end result of their financial agrement

ac (profile) wrote (in reply to...) on Fri, 3/19/2010 - 4:41 pm

That's because the recovery is the result of inflationary policies, and inflation is nothing more than the economic manifestation of theft, deception and lawlessness.

Ouch! That is so true. Inflation hides the transfer of wealth from the working class to the "investor" class....

The extensive margins of trade are very sensitive, very thin profits (a minority of the trade, but large majority of firms)
profit margins of 3-5%
this at a time when shipping costs are snapping back
and material costs are elevated
and labour costs are rising
and RE prices/rent is rising
and demand has been choppy
and firm level reserves are still weakened from what happened 1 year ago
China has to appreciate the Yuan, for their own sake. It's also the last thing they want to do, they don't want to be seen in a position of weakness. First they'll shake down undesirable actions at a micro level, they'll raise reserve requirements, they'll let foreign investors be responsible for pumping up the stock market with the newly announced joint ventures to take advantage of trading stock indices
The reason why they have to appreciate is they cannot make use of the liquidity, so it spills over into nearby countries or markets like commodities (a loss for China) or it makes things very unstable domestically (workers demanding pay raises with violent means, no one can afford to own a 70yr lease)
They can't hike the interest rate, because they have to eat the losses between the interest earned on their reserves and the domestic rate

Shhhh! Health Insurers Might Actually Like Something to Pass on Sunday

Inflation hides the transfer of wealth from the working class to the "investor" class.

And unions try to claw it back. But there is still no labor leader on the Fed Board of Governors. Tell that to Mish, sir.

EvilHenryPaulson wrote:

giving tax breaks for borrowing money is one of the stupidest things I can conceive

i would argue paying people to buy things is a bit more stupid (C4C, FTHB tax credit, etc), but it is close.

Cinco-X wrote:

Like any other tax break, it's intended to get people to modify their behavior. In this case, the objective is to get people to borrow money.

The true objective is to establish a profitable stream of bank revenue. Everything else is the "by whatever means necessary" part.

ghostfaceinvestah wrote:

And Dick Bove expects that that level is 10%-15% below today's prices.

OMG, that might be the first correct call that clown has made in years. ("Lehman won't go bankrupt." "Banks are a generational buy." )

EvilHenryPaulson wrote:

giving tax breaks for borrowing money is one of the stupidest things I can conceive

What tax break do you think is involved with a reverse mortgage?

What's the over/under on lawyerliz's hospital bill?

$19,000 is the number i'd use.

Depends on who's paying. And more to the point, the actual amount changing hands is going to be a lot different than the "bill".

Cinco-X wrote:

Like any other tax break, it's intended to get people to modify their behavior. In this case, the objective is to get people to borrow money.

I understand it is a lending subsidy, initially its a cheap vote getter because people are stupid
if you think about it, it's just like the worst jokes from the USSR
all this required pointless dancing around getting in the way of progress

Utah & Georgia on the map, Sheila is all over the place today

Cinco-X wrote:

CIT Below Book Value; Securitization’s Hard Work

"The companies would rather see the uncertainty go away through some sort of closure"

The only way to get closure on this whole health care bill mess is for it to die on Sunday. Once it passes(which I'm fairly certain it will), health care will be the main topic of political conversation for the foreseeable future. Why does anyone think the issue is going to go away if it passes? Something like 33 states and countless other groups have lawyers prepping the paperwork right now for court challenges. Everything in DC from Sunday on will be filtered through the lens of the health care bill. Every single bill introduced in congress from now on will be gone through with a fine tooth comb to find any kick backs or giveaways rewarded to congressmen for switching their health care votes to yes. If you think there's been partisanship in DC for the last year, you ain't seen nothing yet.

so much stupidity is still spreading:
House GOP calls for Fannie, Freddie phase out - Yahoo! Finance 

"The House Republicans' 10 principles also recommend establishing a regulatory framework for a U.S. covered bond market. Unlike traditional mortgage-backed securities, covered bonds allow banks to manage a dynamic pool of mortgages that remain on a bank's balance sheet. They are seen as safer than securitized offerings since the issuing bank is held responsible for payments to investors.

The principles call for reduced leverage by phasing in capital requirements over four years that are consistent with global standards for large, complex financial institutions.

The goals also urge restoring stability and liquidity to the secondary market for residential mortgages, and preventing significant disruption to financial markets."

Um, I don't think getting rid of fannie and freddie while the housing market takes another nosedive is going to be productive.

I think that the kicking the can forward has met the natural limits inherent in ignoring problems.

I go skiing for a week, and nothing happens, still no healthcare bill.

Oil took a dump today, interestingly weak and gold and silver too.

Could be an exhausted market finally feeling gravity.

Someday this war's gonna end...

EvilHenryPaulson wrote:

sportsfan wrote:

What tax break do you think is involved with a reverse mortgage?

Mortgage in general

Oh, well the mortgage interest deduction doesn't make a lot of sense to me either, but I don't get to advise Congress on amending the IRC.

With reverse mortgages by old folks, though, which is what I thought you and liz were discussing, I'm pretty sure the interest doesn't exceed the standard deduction for most of the people who take out reverse mortgages.

EvilHenryPaulson wrote:

the Fed is pinned down and powerless

Don't forget that low interest rates give cheap carrying costs on MBS and other assets that permit banks to avoid write-downs.

Utah and Georgia step up to the pan.....

lol
PALM shares are finally down... who could have seen that coming from behind that huge pile of debt
but don't worry, if I'm right about PALM it just means I must be wrong on GM, Ford, chrysler, Las Vegas Sands, Manitowoc, or some other company
according to Bernanke, I'm the hocus-pocus one, better stick with the beard and buy all the housing you can get your hands on... and the Nasdaq, buy lots of Nasdaq, going to 5000 any day now

Oxtail wrote:

If you think there's been partisanship in DC for the last year, you ain't seen nothing yet.

I say we issue firearms to both sides and let them find out who is still standing when it ends.

Cinco-X wrote:

Like any other tax break, it's intended to get people to modify their behavior. In this case, the objective is to get people to borrow money.

Logical reasoning, but the tax code has become so opaque that it is the rare person who can interpret how changing income (or income source) will affect the tax liability. Phase-in and phase-out of various credits (and taxable SSA) result in wildly fluctuating marginal tax rates that are virtually unpredictable.

Phase-in and phase-out issues are high on the list of tax concerns of Nina Olsen, the Taxpayer Advocate, but the reality is that the only way this sort of thing can be corrected is to tear up the book and start from scratch.