Still holds the shores where fleeing capital runs to. The Hong Kongian Vix jumped 40%.
It seems that the US economy might not have any other way to go but up. Direct investment is declining across the globe. And here is the US economy once more, standing again at the shore watching capital swim its way looking for dry land.
Wednesday, August 22, 2012
Monday, August 20, 2012
Muni Money Mani Mo
More than a handful of analyses have been ditched out like out of a toaster about how Muni defaults are really not a risk.
The Meredith got it all wrong.
Meanwhile, Buffet just recalled all his defaults swaps on all muni debt. This is usually an expensive move having to recall the insurance at a premium. If someone can afford it, he can, and he did.
If he had the capital to recall it early; then he doesn't need the capital to invest it somewhere else. So why do it.
I think the FED calls this move Quantitative Ease. They also act like this with very old bills and with counterfeit. They just take them all out and disappear them.
It is a pretty terminal decision for The Long Term Value Investor.
The Meredith got it all wrong.
Meanwhile, Buffet just recalled all his defaults swaps on all muni debt. This is usually an expensive move having to recall the insurance at a premium. If someone can afford it, he can, and he did.
If he had the capital to recall it early; then he doesn't need the capital to invest it somewhere else. So why do it.
I think the FED calls this move Quantitative Ease. They also act like this with very old bills and with counterfeit. They just take them all out and disappear them.
It is a pretty terminal decision for The Long Term Value Investor.
Sunday, August 19, 2012
The July Yield
It seems naive to read warnings to the buyers of corporate bonds that they will loose money. The basic assumption is that both sides of the transaction are aware of the basics, they should just have different expectations.
The explanation given is that buyers are looking for quality investment. Under what calculation, a sure drop in price becomes a positive return?
There could be a sharp pencil expecting still lower yields in contrast to an uncertain world where US Corporations might continue making a deeper dent.
In the other hand, in a global market, the expected depreciation of other currencies might easily cover the devaluation of the principal. Then, it comes the reinvestment at higher yields if the warnings are correct. But this already makes it an unsafe strategy compared to what the original assumption was when trying to explain why so many buyers are snatching very expensive bonds.
Follow the money and the end of the month data, and answers might reveal themselves.
------/////
The numbers show that a lot of the flight to bonds are 401k owners.
The explanation given is that buyers are looking for quality investment. Under what calculation, a sure drop in price becomes a positive return?
There could be a sharp pencil expecting still lower yields in contrast to an uncertain world where US Corporations might continue making a deeper dent.
In the other hand, in a global market, the expected depreciation of other currencies might easily cover the devaluation of the principal. Then, it comes the reinvestment at higher yields if the warnings are correct. But this already makes it an unsafe strategy compared to what the original assumption was when trying to explain why so many buyers are snatching very expensive bonds.
Follow the money and the end of the month data, and answers might reveal themselves.
------/////
The numbers show that a lot of the flight to bonds are 401k owners.
Wednesday, August 8, 2012
Hayek
I am not sure. It could have been his idiosyncrasies. When Paulson went on Charlie Rose after he had left office, it seemed his relation with Goldman Had become a soft spot.
With no doubt, at the moment of crisis, his closeness became the only venue he could see for a solution.
There have been interesting questions raised about what could have been done when it all happened.
Way before they even acknowledged the crisis, the wise men spread the rumor of allowing Hayek run free. It was a clear solution before the too big to fail was pitched the same way Chrysler became one of three.
It would have been painful, but the proponents showed the vision. The business lost should have been satisfied by competitors. Instead, it dragged not only loosing the business but also loosing the demand.
With no doubt, at the moment of crisis, his closeness became the only venue he could see for a solution.
There have been interesting questions raised about what could have been done when it all happened.
Way before they even acknowledged the crisis, the wise men spread the rumor of allowing Hayek run free. It was a clear solution before the too big to fail was pitched the same way Chrysler became one of three.
It would have been painful, but the proponents showed the vision. The business lost should have been satisfied by competitors. Instead, it dragged not only loosing the business but also loosing the demand.
Wednesday, August 1, 2012
The New Rising Global NFL league
The NFL is a league of stats. It seems the purity of the game is born from its unmatched transparency.
After all the turnmoil, there is the possibility that everything was just the prolog of what is to come.
If the Libor investigation bears undeniable proof, all the major banks have just become a target of compensatory lawsuits from the rest of the world that feels they have suffered from a strict and placist system with a rigged rule book.
After all the turnmoil, there is the possibility that everything was just the prolog of what is to come.
If the Libor investigation bears undeniable proof, all the major banks have just become a target of compensatory lawsuits from the rest of the world that feels they have suffered from a strict and placist system with a rigged rule book.
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