Vigilant Investor Vigilant Investor Surfing the Great Credit Bubble and its unwind. Discussions about how your investment evironment and economy are changing. Don't be a fall guy! Articles
Orange County Joining FL, others in Local Government Subprime Crisis?
2007-12-05 18:19:00 From the “When will they ever learn?” files, Orange County, CA, joins Florida, Connecticut, Massachusetts, Montana, Maine and King County, Washington in disclosing problems related to massive SIV losses. Reports Bloomberg, Twenty percent, or $460 million, of the county’s $2.3 billion Extended Fund is invested in so-called SIVs that may face ... More About: Economy , Government , Housing Bubble , Currency
Connecticut Short-Term Fund In SIV Soup
2007-12-04 11:39:00 From Bloomberg: Moody’s lowered its rating on commercial paper issued by the Orion Finance structured investment vehicle, or SIV, to “Not Prime” on Nov. 30, saying its net asset value is inconsistent with Orion’s former Prime-1 rating. Montana owns $50 million of the paper. Moody’s put another $105 billion of SIVs on review for a ... More About: Economy , Real Estate , Housing Bubble , Connecticut , Currency
Fed?s Rosengren Bashes Libor, Plays Dumb on Subprimes
2007-12-04 03:22:00 “I can’t explain why Libor has been elevated,” (Federal Reserve Bank of Boston President Eric) Rosengren said. “When the Fed is easing, Libor tends to move lower with it.”The higher rates in reset subprime mortgages “are a potential problem now, with ability to easily refinance or sell now gone,” he said during his speech. Speaking to ... More About: Economy , Finance , Currency , Dumb , Gas Prices
Tax Impact on Local Governments from Housing Bust
2007-12-04 01:10:00 Defaulters don’t pay taxes on properties, and those with plummeting house values will demand reassessments. That’ll put pressure on governments that like to plan ahead on revenues generated during the good times. CNNMoney reports that California alone is expected to see a property tax reduction of $3 billion in 2008. Yet governments are no different than ... More About: Economy , Real Estate , Housing Bubble , Currency , Housing
The Pains of Trusting the Crowd?s Conventional Wisdom
2007-12-03 19:39:00 “I might not be able to pay our employees tomorrow. I am sure that those money managers who withdrew all their funds are feeling really smug right now, thinking they did the right thing. But it left the rest of us holding the bag.” – Hal Wilson, CFO for Jefferson County Florida, in reference to his ... More About: Economy , Quotes , Currency , Gas Prices , Wisdom
Montana?s ?Run on the Money Fund? Proves Florida?s Run is no Fluke
2007-12-03 19:34:00 It was reported over the weekend that Montana school districts, cities, and counties were following the lead of their peers in Florida by yanking $247 million from the state’s $2.4 billion investment fund after the SIV, Axon Financial, had its ratings cut to “D” by Standard & Poor’s. The fund’s investment committees had a $90 ... More About: Economy , Finance , Money , Housing Bubble , Currency
Ben Stein ? an Interesting Read, Indeed!
2007-12-02 19:45:00 In today?s New York Times, Ben Stein writes an article pointing out that Goldman Sachs has sold $ billions in Collateralized Mortgage Obligations (C.M.O.?s) — including during a period where current Treasury Secretary Hank Paulson led the firm. In his piece, Mr. Stein also mentions that while Goldman was selling C.M.O.?s ? it was ... More About: Politics , Economy , Interesting , Finance , Commodities
Risk and Reward. Evil Knievel?s Great Jump
2007-11-30 23:14:00 As a kid, my first lessons in risk reward came from none other than Mr. Evil Knievel, daredevil motorcycle jumper, who made his final and greatest jump today into the great beyond. Back in the 1970s, Evil jumped cars, buses, casino fountains, pools filled with sharks, and even the Snake River Canyon . What was ... More About: Video , Great , Risk , Jump
Commercial Real Estate Derivative Trouble
2007-11-30 20:38:00 In the bond market, commercial property investors are about as creditworthy as U.S. homeowners with subprime mortgages. “Commercial real estate is a full-blown bubble that feels very much at a bursting point,” said Christian Stracke, an analyst in London at CreditSights Inc., ... More About: Economy , Estate , Real Estate , Real
Economic Malignancy Isn?t Cured by Ingesting Carcinogens
2007-11-30 16:51:00 This from Nouriel Roubini at NYU yesterday: “Certainly yesterday’s (Wednesday’s) equities rally was totally driven by Fed governor Kohn signaling the obvious, i.e. that given that the liquidity and credit crunch is now worse than at its August peak the Fed will cut rates in December, January and for as long as needed. In this game ... More About: Economy , Finance , Inflation , Debt , Economic
Run on the Florida Investment Fund: Shuts Door on Withdrawals.
2007-11-29 20:02:00 It looks like Florida ’s state investment fund had to shut its doors to prevent a run on the bank after cities, schools, and counties yanked $3.5 billion in one day! Reports the Orlando Sentinel, The State Board of Administration — the governor, attorney general and chief financial officers — voted unanimously to at least temporarily ... More About: Economy , Investment , Currency , Debt
ACA?s Dificulty Spooking the Fed
2007-11-29 19:54:00 Bloomberg published a story on November 21 noting JPMorgan analysts are suggesting that ACA Financial Guarantee Corporation, one of the nations largest bond default insurers of collateralized debt instruments, may be “thrown to the wolves.” This comes after S&P placed its “A” rating of financial strength on “CreditWatch with negative implications” based on a ... More About: Economy , Finance , Real Estate , Inflation , Housing Bubble
Surf?s Up! (Not Just in Credit Bubbles)
2007-11-28 15:47:00 We often describe Vigilant Investor as a publication that helps readers successfully surf the giant credit bubble waves that are crashing ashore. Successfully surfing the big wave involves skill, guts, and art. Enjoy this report from Hawaii’s North Shore where the first big ones of the winter roll in, and good luck ... More About: Video , Economy , Finance , Credit , Surf
Desperate Citigroup Accepts Abu Dhabi Deal. Too Late?
2007-11-27 18:36:00 Citigroup Inc., the biggest U.S. bank by assets, will receive a $7.5 billion cash infusion from Abu Dhabi to replenish capital after record mortgage losses wiped out almost half its market value. $ 7.5 billion is what the Sovereign Wealth fund of Abu Dhabi is going to send to Citigroup to help it shore up ... More About: Economy , Finance , Commodities , Currency , Citigroup
Much Unexpected Economic Information Yet to Clear
2007-11-27 00:16:00 A few articles we thought were worth a read: Dollar Displaces Yen, Franc as Carry Trade Favorite A basket of currencies including the British pound, Brazilian real and Hungarian forint financed with dollars returned 17 percent this year, compared with 9 percent when funded in yen and 7 percent in Swiss francs, according to data compiled by ... More About: Economy , Information , Clear , Economic
Vigilant Analysis of PNC?s Christmas Price Index
2007-11-26 20:12:00 With pear trees up 240%, French hens 300%, and geese up 240% since 2003, and calling birds up 190% and Swans up 200% since 2002 -- the service sector employees represented in the song are finding their compensation severely lagging when it comes to buying even one item mentioned in the song. More About: Christmas , Economy , Commodities , Analysis , Inflation
GM distancing itself from Rescap (and GMAC)
2007-11-22 11:08:00 In April 2006, GM ditched GMAC — its highly profitable finance unit — ostensibly to raise cash given its ongoing struggles to keep the head above water. Back then we questioned the motives, and in todays credit-crisis environment, it appears as if Sun Tsu is terribly proud despite GM Vice Chairman, Bob Lutz’s comments to ... More About: Economy , Real Estate , Housing Bubble , Currency , Debt
Freddie Mac Imploding?
2007-11-21 21:08:00 We knew there was a problem well over a year ago when Freddie and the girls (the other GSEs) were incapable of providing financial numbers that any legitimate accounting firm could feel comfortable with. Today they’re still having problems giving investors legitimate numbers and with the mounting chaos unfolding in the U.S. housing market, ... More About: Economy , Freddie Mac
Europe Suspends Mortgage Bond Trading
2007-11-21 21:02:00 From the “This can’t be good” department, we report that Europe has been forced to suspend trading in the $2.8 trillion mortgage debt markets in an attempt to halt the unfolding calamity in the credit markets. Reports Bloomberg, “We are in a deteriorating situation,” Patrick Amat, chairman of the Brussels-based ECBC and chief financial officer ... More About: Economy , Finance , Bond , Housing Bubble
Liberty Dollar On Kudlow
2007-11-21 15:59:00 For those inclined, here’s a link to the Liberty Dollar founder being interviewed on Kudlow’s show last night. The comments from the panel are interesting, especially the annoyingly self-righteous fellow from Forbes Magazine. Share This More About: Video , Liberty Dollar
The Backed by Something Currency Blues
2007-11-21 11:12:00 The folks over at Liberty Dollar (issuers of gold and silver backed coins and paper receipts) were raided by the Feds for supposedly violating the counterfeiting laws. The FBI claims the liberty coins and paper look too much like the real deal. Also, the Feds claim that Liberty Dollar and its owners were ... More About: Economy , Blues , Currency , Some
Goldman: U.S. May Face $2 Trillion Lending Shock
2007-11-20 18:31:00 The impact of the U.S. mortgage market crisis on the underlying economy could be “dramatic” as leveraged investors may need to scale back lending by up to $2 trillion, according to investment bank Goldman Sachs… “The macroeconomic consequences could be quite dramatic,” [chief U.S. economist Jan] Hatzius said in the note to clients. “If ... More About: Economy , Finance , Shock , Currency , Debt
Mainstreaming of Recession: Acceptance Nearing
2007-11-20 16:02:00 We’ve suggested for probably a year now that the U.S. is in recession for those at lower income levels who are feeling the real effects of rising prices and degrading job opportunities, and that a deeper recession for all was inevitable. Now, in recent weeks its grown more fashionable among analysts and pundits ... More About: Currency , Debt , Acceptance , Recession , Accept
Starbucks Traffic Down an Indicator?
2007-11-18 12:48:00 A decline in foot traffic in U.S. stores lead the Starbucks ’ stock down about the price of a cup of their coffee ($2.25) at the open of trading on Friday. We won’t make too much out of this other than to question if the highly popular java joint might not be sharing the pains of consumers ... More About: Economy , Traffic , Inflation , Crash
When will Oil be priced in Gold?
2007-11-17 22:41:00 You know everyone is thinking it ? so there, we asked it! In an era where the world?s most famous supermodel insists on being paid in Euros (not Dollars), and rap stars flash Euros vs. Greenbacks ? it?s a logical question. Especially when you consider that Gold /Silver backs NO government currency on the planet, and ...
Commercial Real Estate: Another ?Other Shoe?
2007-11-17 12:13:00 Regular readers of Vigilant Investor know we’ve been tracking dozens of shoes that have been readying their drops when it comes to the economy. The housing bubble and mortgage markets, for example, were a few big shoes that have crashed to the ground reveling the precarious nature of the big Kahuna shoe — the ... More About: Economy , Commercial , Estate , Real Estate , Real
Some Predicted Fed Policy Would End in Crisis 2.5 Years Ago
2007-11-16 20:17:00 April, 2005: "Indeed, [popular economists] are merely dallying with the symptoms of a far greater, although fundamentally very basic problem: Excesses, distortions and dislocations caused by manipulation of credit and money supply." Read our post to find out who said it! More About: Economy , Inflation , Housing Bubble , Currency , Policy
FASB 157 Forces Banks to Come Clean
2007-11-16 16:02:00 Here are a two video clips of economist Nouriel Roubini of RGEMonitor and NYU being interviewed on MSNBC the demise of the now infamous mark to model accounting of assets, which allowed big players to value assets not at their market rate but rather at by using model-based assumptions. A clip discussing FASB 157 A clip discussing ... More About: Video , Economy , Banks , Clean , Debt
More Liquidity Dropping on the Dollar Debt Note
2007-11-16 04:12:00 Today we learn that the Fed has again made another temporary liquidity injection to qualify as the largest since the times around 9/11 in order to provide grease for the still shrinking U.S. commercial paper market. The amount, $47.25 billion, was to defend the federal funds target of 4.50% that had traded as high ... More About: Dollar , Note , Debt
What is the Mainstream Missing on Gold?
More articles from this author:2007-11-14 23:40:00 Frequent Kudlow guest, Jerry Bowyer, published a piece today over at Town Hall that would appear to compound prevailing myths regarding the history of the gold monetary standard, as well as the present misinterpretation of the meaning of $800-plus gold. While tipping his hat to the Austrian / Misesian views on currency, like ... More About: Economy , Finance , Gold , Commodities , Inflation 1, 2, 3, 4, 5, 6, 7 |
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