Saturday, October 29, 2011

Saturday roundup (10-29\-11)

Euro-Zone Economic Data Point to Gloomy Year-End (The Wall Street Journal)

EU May Struggle to Keep Euphoria as Post-Summit Scrutiny Deepens (Bloomberg)

This Could Be the Fatal Flaw in Europe's Rescue Plan: Private investors are being forced to eat losses. In return, they'll demand higher interest rates from Italy and Spain. That makes it more expensive to insure Italian and Spanish debt. (The Atlantic)

Trichet says 'crisis not over', hard work ahead - paper (Reuters)

Portugal, Spain urge G20 members to help ease crisis (Reuters)

Portugal wants U.S. help in euro crisis: source (Reuters)

Most Portuguese don't trust government, doubt budget goals: poll (Reuters)

Merkel says sovereign debt crisis won't be over for a year (The Irish Independent)

EU debt woes to last 'two or three years' [according to the head of the European bailout fund Klaus Regling] (Agence France-Presse)

Can Super Mario Save the Day for Europe? (The New York Times)

UK business pensions deficit hits record of £295bn: British businesses face a corporate pensions deficit of £295bn, a figure which has ballooned as retirement liabilities hit new records. -- "the deficit is now so large that retirement liabilities at companies such as Premier Foods, BAE and BT now dwarf the value of the company itself." (The Sunday Telegraph)

Italian government buys 19 Maserati supercars despite austerity cuts: Italy may be in the midst of a savage austerity drive but that has not stopped defence ministry officials ordering a fleet of armoured Maseratis to ferry themselves around Rome. (The Telegraph)

National debt nears size of U.S. economy (USAToday) The debt fallout: How Social Security went ‘cash negative’ earlier than expected (The Washington Post)

Early snow pelts East Coast, cuts power to 1.7M (The Associated Press)

Motorola to cut 800 jobs (Marketwatch)

The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.

Friday, October 28, 2011

Friday roundup (10-28-11)

Quote of the Day:

"Pour dire la vérité s'il y avait pas eu d'accord hier soir, ce n'est pas simplement l'Europe qui sombrait dans la catastrophe, c'est le monde entier ..." ["To tell the truth, had there been no agreement last night, it would have precipitated a catastrophe, not for Europe alone, but for the entire world."] -- French President Nicolas Sarkozy (Le Monde) (Youtube)



Eurozone bail-out: holes emerge in the 'grand solution’ to solve EU debt crisis: A trillion euro bail-out to save the EU’s single currency is in danger of unravelling after Germany’s central bank warned that the rescue measure was too dependent on the high-risk deals that caused the economic crisis. (The Telegraph) German Constitutional Court Halts EFSF Approval, Issues Temporary Injunction On Further Bailout Decisions (ZeroHedge blog) German court suspends parliament's bailout committee (Reuters) German Constitutional Court Halts Special Euro Panel: Germany's highest court has issued a temporary injunction banning the work of a new panel convened by the country's parliament to quickly green-light decisions on disbursement of taxpayer funds through the euro bailout program. The decision could lead to further delays in German decision-making in efforts to rescue the beleaguered common currency. (Der Spiegel)

Sarkozy Says: If Greece had gone down, all of Europe would have gone down (Cliff Küle's Notes blog) Sarkozy: Greece should never have been allowed into the euro zone (Credit Writedowns blog) Sarkozy:"Dopo la Grecia sarebbe caduta l'Italia" [Sarkozy: "After Greece, Italy would have fallen"] (RAINews) Sarkozy s'explique sur la crise: l'émission en intégralité (TF1)

Italian debt soars on EU bail-out fears: Fears over the ability of the eurozone bail-out to protect the region's embattled members have been heightened after Italy was forced to pay the highest price to issue debt since the launch of the euro. (The Telegraph) Italy at heart of crisis as borrowing costs climb (Reuters) Berlusconi Says Italy ‘Most Solid’ EU Country After Germany (Bloomberg) Record borrowing costs put Italy at centre of crisis: Relief at European debt deal fades as Rome struggles at first test since Brussels summit (The Independent)

ALBERT EDWARDS: If Italy Is Insolvent, Then France And Germany Are Even Worse (The Business Insider)

Fitch: Greek Debt Deal a Default (The Wall Street Journal)

“Standard” Credit Default Swaps on Greece Are a Sham and It’s Not a Surprise by Janet M. Tavakoli, President, Tavakoli Structured Finance, Inc. (Takakoli Structured Finance) [As noted in yesterday's blog via two posts in ZeroHedge] (Economic Signs of the Times blog) Greek deal may imperil sovereign CDS market (Reuters) Credit-Default Swaps as Hedge Threatened by Greek Debt Plan (Bloomberg) If Greek CDS Don’t Trigger, Why Would EFSF? (The Wall Street Journal)

BoE's Tucker: UK's dip into recession possible - paper (Reuters) [The Bank's Fisher issued a similar warning yesterday, as posted here.] (Economic Signs of the Times blog) Fresh fears of double dip as consumer confidence vanishes (The Scotsman)

[Hundreds of] Small U.S. Banks Struggle to Repay Bailout Funds — Watchdog (The Wall Street Journal blogs)

Regulators close Illinois bank, 2011 total now 81 (Reuters) All American Bank of Des Plaines IL had a troubled assets ratio of 219.3%. (BankTracker)

Whirlpool to cut 5,000 jobs, close Arkansas plant (The Associated Press)

Motorola Mobility Expects $31 Million in Costs as It Eliminates 800 Jobs (Bloomberg)

Newell Rubbermaid cuts [500] jobs in restructuring (The Atlanta Journal-Constitution)

The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.

Thursday, October 27, 2011

Thursday roundup (10-27-11)

EU Forges Greek Bond Deal: Private Investors to Take 50% Haircut; Firepower of Bailout Fund Increased (The Wall Street Journal) EU Reaches Deal on Greek Debt (The Atlantic)

Eurozone buys time with debt deal, but could squander it by fumbling on the complex details (The Washington Post) Euro leaders tell of drama in bailout plan talks (The Washington Post)

The Greek Bailout Doesn't Actually Solve the Problem (Forbes) Euro zone debt deal tackles symptoms not cause (Reuters) So. Many. Bailout questions (FT Alphaville blog) Europe's new debt crisis agreement: the good, the bad, the ugly (Time blogs) Six problems facing the eurozone: From riots in the street to rejected haircuts: six problems facing the eurozone (The Guardian) Gauging the Fallout of Another Rescue (The New York Times)

Europe debt crisis plan hinges on economic growth: Without economic growth, the European Union nations that struck a deal to avert financial collapse risk a return to recession. That could undermine their efforts and bring greater social disorder. (The Los Angeles Times) Never mind the euro bailout, worry about growth, says Shell: Brussels' failure to cultivate growth across Europe is a bigger worry for oil and gas major Royal Dutch Shell than the region’s sovereign debt crisis. (The Telegraph)

EMU summit leaves €1,000 billion to be raised (Financial Times blogs)

Barclays Explains Why A 50% Greek Haircut "Would Be Considered A Credit Event, Consequently Triggering CDS Contracts" (ZeroHedge blog) Farce Is Complete As ISDA Finds 50% "Haircut" Is Not A Credit Event (ZeroHedge blog)

Europe Economic Confidence Drops to Lowest in Almost 2 Years (Bloomberg)

Europe’s Punishment Union (The Telegraph blogs) Thank you Germany (The Telegraph blogs)

Greece Will Leave Euro Even With Pact: Rogoff (Bloomberg)

Economists: EFSF Not Enough to Relieve Italy Fears (The Wall Street Journal blogs)

Europe's rescue euphoria threatened as Portugal enters 'Grecian vortex': Monetary contraction in Portugal has intensified at an alarming pace and is mimicking the pattern seen in Greece before its economy spiralled out of control, raising concerns that the EU summit deal may soon washed over by fast-moving events. (The Telegraph)

UK economy is 'cratering', warns economist [Adam Posen, a member of the Bank of England's interest-rate setting Monetary Policy Committee] (The Independent)

'Significant chance' of double-dip recession, says Bank of England expert [Paul Fisher, a member of the bank's monetary policy committee]: Monetary policy committee member suggests UK faces second recession in three years (The Guardian) BOE Fisher Sees Risk of Recession, Deflation: Bloomberg TV (Market News International)

UK Won't Contribute To Euro Bailout Fund - Osborne (The Wall Street Journal)

Obama says full implementation of European debt plan is crucial to success (The Associated Press) Five ways the European debt crisis could affect the U.S. (USAToday)

The Red Flag in Today’s GDP Report -- "consumers are cutting into savings." (The Wall Street Journal blogs)

Median US New Home Price Has Biggest 3 Month Drop Ever (ZeroHedge blog) Home Prices in U.S. Cities Fall More-Than-Forecast 3.8%, Case-Shiller Says (Bloomberg)

Obama's Student-Loan Order Saves the Average Grad Less Than $10 a Month (The Atlantic) 66% Oppose Forgiveness of Student Loans (Rasmussen Reports)

Whitney Wasn't All Wrong: Muni Bonds Still Face Dangers (CNBC)

A Message to All Police Officers From Occupy Wall Street (CollapseNet)

A Message to All Police Officers From Occupy Wall Street from CollapseNet.com on Vimeo.


The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.

Is it a recovery yet? (Weekly report, 10-27-11)

A recovery would be indicated by weekly initial jobless claims holding below 500,000. (See this post.)

IT'S A RECOVERY! (And it has been a recovery for every week since the Nov. 25, 2009 report, with the exception of the Aug. 19, 2010 report.)

"Initial jobless claims in the week ended Oct. 22 decreased by 2,000 to a seasonally adjusted 402,000, the Labor Department said." (Marketwatch)

Jobless Claims in U.S. Decline 2,000 in Limited Labor Market Improvement -- "'We’re not making much progress,' said Robert Dye, chief economist at Comerica Inc. in Dallas. 'Unless we see the labor market improve, we won’t see income growth. The consumer will remain fundamentally constrained.'" (Bloomberg)


The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.

Wednesday, October 26, 2011

Wednesday roundup (10-26-11)

EU leaders dither over rescue plan: European Union leaders have been accused of failing to address the continent’s debt crisis as an emergency summit stumbles towards a limited rescue deal and ducks critical decisions. (The Telegraph) As Europe Debates Greek Debt Writedown, Economic Crisis Looms, Economists Say (The Huffington Post blog)

Europe's grand gamble risks failure without ECB: Europe's "Grand Plan" to save monetary union is, in broad terms, a settled matter, even if the usual theatrics were still dragging on into the small hours of the Belgian night. -- "If it goes wrong, it may accelerate contagion to core Europe" (The Telegraph)

Financial Firms Agree to 50% Nominal Discount on Greek Debt (Bloomberg)

Europe Agrees on a Bank Plan but Little Else (The New York Times) EU Euro Zone to Quadruple Bailout Fund: Sources (CNBC) http://www.cnbc.com/id/45049889 European banks will be forced to increase capital (The Associated Press) EU Banks Must Raise $147 Billion of Extra Capital, EBA Says (Bloomberg)

Draghi Urges Immediate Implementation of Bailout Fund to Stop Debt Crisis (Bloomberg)

Eurozone crisis: live blog (The Financial Times blogs) Live Blog: European Debt-Crisis Summit (The Wall Street Journal blogs) Debt crisis: live: EU summit in deadlock as parties remain at loggerheads over Greek debt writedowns. (The Telegraph)

Niall Ferguson on European Sovereign-Debt Crisis: Niall Ferguson, a history professor at Harvard University and a Bloomberg Television contributing editor, talks [on Tuesday] about the European sovereign-debt crisis and its implications for the euro zone and banking industry. Ferguson speaks on Bloomberg Television's "InBusiness With Margaret Brennan." (Bloomberg)



Lines to Withdraw Deposits Queue Up as Run on the Banks starts in Greece (Mish's Global Economic Trend Analysis blog)

Italy On The Ropes Again After Secret Berlusconi Promise To Step Down In Exchange For Compromise Achieves Nothing (ZeroHedge blog) Berlusconi Reaches Deal on Pensions; To Resign? (CNBC) Beleaguered Berlusconi buys time [to stay in power] (Agence France-Presse)

Italy Key to Euro-Zone Crisis, Barclays’s Callow Says: Tom Keene (Bloomberg)

Nightmare scenario: U.S. deflation risks rising (Reuters)

Deficit-cutting 'super committee': Can it come up with a plan in time?: Congress's super committee may have just days to act in order to meet its deadline and prevent $1.2 trillion in automatic cuts to defense and nondefense spending. So far, no plan has emerged. (The Christian Science Monitor)

Bill Black: What I'd Demand of the Fed (The Real News Network)



Peugeot to Cut 6,000 Jobs Amid Lower Profit Outlook (The New York Times)

Itron posts Q3 loss, to cut 750 jobs (Reuters)

The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.

Tuesday, October 25, 2011

Tuesday roundup (10-25-11)

Roubini sees double-dip slump in major economies (Marketwatch) The Nouriel Roubini CHOGM show (The Business Spectator)

U.S. says Europe crisis creates global uncertainty (Reuters) Geithner: Europe Crisis World’s Biggest Challenge (The Wall Street Journal blogs) Collyns Says Euro-Area Crisis a ‘Serious Risk’ to Recovery (Bloomberg)

Eurozone debt crisis: talks break down as Angela Merkel rejects rescue deal: Rows between Europe’s leaders threatened to undermine attempts to rescue the eurozone as it emerged that a make-or-break summit will not address key aspects of the deepening crisis. (The Telegraph) Europe Faces New Hurdles in Crisis Over Debt (The New York Times) Officials say still no deal on cutting Greece’s debt, boost crisis fund, Italian commitments (The Associated Press)

EU Summit Unlikely to Reach Deal: Official (CNBC) Fears Euro Summit Could Miss Final Deal -- The Financial Times via (CNBC) Conclusive summit deal on euro zone crisis looks elusive (Reuters) EU rescue plans hostage to raw politics: Europe's debt crisis has taken a deeply political turn as parliamentary battles rock Italy and Greece and once again cause simmering dissent in Germany, vastly complicating the search for a workable solution. (The Telegraph)

Bank Group Sees EU Recession Amid Push for Bigger Write-Downs (The Wall Street Journal blogs) EU bailout plan could result in bigger losses to banks (The Toronto Star) [Unsurprisingly, therefore ...] Banks threaten to derail EU debt crisis strategy (The Irish Times)

Euro zone debt deal may not ease bank access to cash (Reuters)

Euro Region’s Debt Quality Is Worsening at Record Pace: Chart of the Day (Bloomberg) [Chart @] (The Disciplined Investor)

Bank of England governor Mervyn King says euro fix is just buying time (This is Money)

Europe’s Crisis May End in a ‘Violent Blow-Up’: Galbraith (Yahoo!'s The Daily Ticker)


IMF considering participation in EU bailout fund (Reuters) EU May Ask IMF To Administer Special Debt Crisis Fund - Source (Dow Jones Newswires) As Hope For EFSF Solution Vanishes, Europe Comes Crawling To Uncle Sam (ZeroHedge blog)

CAN FINANCIAL ENGINEERING SAVE THE EURO? (The New Yorker blogs)

Mobius takes a swipe at derivatives (The Globe and Mail of Toronto) Why Don't We Know More About Bank of America's Derivatives? (CNBC)

Felix Zulauf: The Die Is Cast (The Big Picture blog) Felix Zulauf says the die is cast. Is it? (Credit Writedowns blog)

Things That Make You Go Hmmm… by John Mauldin (Investors Insight)

Greek debt crisis presents Lehman-like danger for financial markets (The Times of London) Alternative to Greek 'haircut' may be catastrophic for euro zone (The Irish Times)

Merkel Faces Fresh Showdown on Bailout (The Wall Street Journal)

Italy's government teeters amid EU debt pressure (EuroNews) Italian government on the brink as EU plan stalls: Berlusconi's government at risk over EU demands as broader crisis plan faces setbacks (The Associated Press) Italy keeps Europe on tenterhooks over reform
(Reuters)



[Nevertheless, later in the day ...] Berlusconi Government Strikes Deal on Pensions (The Wall Street Journal)

If Italy fails to enact needed reforms, the impact will be catastrophic (The Globe and Mail of Toronto)

Italians rally around Berlusconi after the Merkozy smirk (Credit Writedowns blog) "'Berlusconi’s standing in international politics has been seriously damaged,' said Nicola Marinelli, who oversees $153 million at Glendevon King Asset Management in London." (Bloomberg) MERKEL E SARKOZY RIDONO DI BERLUSCONI [Merkel and Sarkozy laugh at the expense of Berlusconi] (Youtube)



Merkel & Sarkozy on their trust in Berlusconi (Youtube)



Italian Consumer Confidence Drops to Three-Year Low Amid Sovereign Crisis (Bloomberg)

Britain at risk of falling back into recession: Britain is at risk of falling back into recession and the size of the economy may be already shrinking, a senior Bank of England figure warned last night. (The Telegraph) Eurozone crisis is dragging UK into double-dip recession, warns Bank of England expert [who is viewed as "one of the more optimistic members" of the interest-setting Monetary Policy Committee] (The Daily Mail)

U.S. Consumer Confidence Drops to 2-Year Low (Bloomberg) Richmond Fed, FHFA House Prices decline, Consumer Confidence down (Calculated Risk blog) Vital Signs: Consumer Confidence Tumbles (The Wall Street Journal blogs) Confidence Falls Most Among High-Income Consumers (The Wall Street Journal blogs) "'The outlook continues to deteriorate,' said Yelena Shulyatyeva, a U.S. economist at BNP Paribas in New York. 'It’s not good for confidence when people see their main asset, their homes, decline in value. Our best-case scenario is we’ll muddle through.'" (Bloomberg)

Fed activists loudly signal low bar to easing (Reuters)

U.S. throws lifeline to underwater homeowners (Reuters) Refinancing plan won't help housing market (CNNMoney) “Obama to Bypass Congress on Mortgages” … But “New Obama Foreclosure Plan Helps Banks At Taxpayers’ Expense” (Washington's Blog)

Dems call out Romney for foreclosure remarks (CNN blogs) Dems slam Romney on foreclosure comments (The Hill) "Under Water" (Youtube)



Why Politicians Don't Want to Touch the Housing Crisis: Republicans complain Obama's new measures are a political ploy. But when it comes to housing, there may be no safe political ground. (The Atlantic)

White House Unveils Details of Student-Loan Relief Plan (CNBC)

Banks Have More Money Than They Know What To Do With, As Borrowing Slows (The Huffington Post blog) In Cautious Times, Banks Flooded With Cash (The New York Times) What's in Your Wallet? The Future of Cash (The Federal Reserve Bank of San Francisco)

No Joke: Times Getting Tough for U.S. Bankers (The Wall Street Journal)

Nationwide EAS Test coming on Nov. 9 (WXIA TV) "The first Nationwide test of the Emergency Alert System will be carried out on November 9, 2011." (The FCC)

Cut $1 trillion, lose 1 million jobs, defense industry warns (Marketwatch blogs)

Sweden's SCA to cut 2,000 jobs to pare costs (Marketwatch)

Novartis to Cut 2,000 Swiss, U.S. Jobs, Add Staff in China (Bloomberg)

From seed to pizza slice: Lawns to Loaves celebrates organic, sustainable food (The Vancouver Observer)

The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.

Monday, October 24, 2011

Monday roundup (10-24-11)

'Miserable' Euro PMI Heightens Recession Risk: Economists (CNBC) Fresh Worries of Recession Grip Europe: Berlusconi Fires Back at Germany, France as Political Tensions Mount (The Wall Street Journal)

European bailout fund may more than double to $1.4 trillion: Leaders are closing in on a plan to boost the Eurozone bailout fund that is partly dependent on public and private investments, which they hope will come from countries such as China and Brazil. (The Los Angeles Times) New EU bailout will fuel a debt supercycle (Fortune)

Euro-Zone’s Leveraged Solution to Leverage by Satyajit Das (Wilmott blogs)

Factbox: What EU leaders must decide at crisis summit (Reuters)

Vital Signs: Struggling European Manufacturing (The Wall Street Journal blogs)

[Australia's Prime Minister] Gillard warns of new Great Depression (The West Australian)

US States Are Facing Total Debt of Over $4 Trillion (Reuters)

Fed’s Dudley Calls for Breaking ‘Vicious Cycle’ in Housing (Bloomberg) Fed could target US housing to help economy - Dudley (Reuters)

Hiring Plans at U.S. Companies Slump to Weakest Since [January] 2010, Survey Shows (Bloomberg) Survey: Economists more bleak about US economy (The Associated Press) Economists Predict Scant Growth in 2011 (The Wall Street Journal blogs)

The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.

Sunday, October 23, 2011

Sunday roundup (10-23-11)

No deal yet on euro crisis as the danger grows: Delayed crisis plan raises stakes in euro crisis; Italy under pressure to get economy in shape (The Associated Press) Europe leaders tout progress on debt crisis plan: Final agreement on package of measures expected Wednesday (Marketwatch) European Leaders Deal Directly With Debt Dilemma (The New York Times)

Crunch Time for Franco-German Relations (The Wall Street Journal)

The European Financial Crisis in One Graphic: The Dominoes of Debt by Charles Hugh Smith (Of Two Minds blog)

Leaked Greek Document: Expansion & Austerity Don't Work (Duh) (Cliff Küle's Notes blog)

Report: European Banks need to raise €108bn in new capital (Calculated Risk blog) UBS, Deutsche Bank Seen Speeding Cuts as Europe Crisis Worsens (Bloomberg)

Nicolas Sarkozy tells David Cameron: 'We’re sick of you telling us what to do': David Cameron clashed repeatedly with Nicolas Sarkozy today after the French President tried to exclude Britain and non-eurozone countries from a critical Brussels summit to rescue European banks. (The Telegraph)

EU leaders tell Italy: stop the rot and get your house in order: Pressure on Silvio Berlusconi to bring country's debts under control as Europe fears another deep-rooted recession (The Guardian) Berlusconi under growing pressure to sort out finances (The Irish Times) Italy told to fix finances at EU summit (Agence France-Presse) Berlusconi, under EU pressure, calls urgent cabinet meeting (Agence France-Presse)

Obama administration ramps up mortgage refinancing effort: The White House hopes by the end of the month to announce changes that will make it easier for more homeowners — perhaps millions more — to participate. (The Los Angeles Times) U.S. readies stronger lifeline for homeowners (Reuters)

The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.

Saturday, October 22, 2011

Saturday roundup (10-22-11)

European Leaders Open Last-Ditch Push to End Debt Crisis, Safeguard Banks (Bloomberg) Eurozone summit - despair and backbiting in the corridors of power: The ever-worsening eurozone crisis has sent relations between its leaders to an all-time low, reports Bruno Waterfield in Brussels -- [The word from the EU finance ministers meeting is:] "'It was grim. The worst mood I have ever seen, a complete mess,' said one eurozone finance minister." (The Telegraph)

Europe's leaders threaten Greek default if banks won't take haircut and accept losses of £120bn: Lenders 'may need €100bn in capital’ as finance ministers battle to reach agreement in Brussels (The Telegraph) Big banks under pressure in Europe crisis (The Associated Press)

Most Greek bailout money has gone to pay off bondholders -- "a transfer of billions of dollars from taxpayers around the world to European banks and pension funds" (The Washington Post) Eurozone to keep paying Greek debt (SkyNews)

It’s All Connected: An Overview of the Euro Crisis: European leaders are meeting this week to deal with growing debt problems rattling investors worldwide. Here is a visual guide to the crisis. (The New York Times)

European debt crisis: Worst-case scenarios: What would happen if Greece, Spain or Italy were to default? Deutsche Bank, RBS and other investment research firms have released reports detailing the domino effect of a collapse of a single country in the euro zone. Here’s the doomsday scenario. (The Washington Post)

Merkel Takes Aim at Italy, Demands Eurozone Countries Cut Debt (Bloomberg) Merkel says Spain, Italy must do more on debt reduction (Reuters)

Eurozone debt crisis is a 'real danger' to Britain: The European debt crisis poses a "real danger" to Britain, Chancellor George Osborne has warned as he arrived for negotiations on tackling the financial problems facing the Eurozone. (The Telegraph)

Unofficial Problem Bank list declines to 976 Institutions (Calculated Risk blog)

The Only Way to Save the Economy: Break Up the Giant, Insolvent Bank (Washington's Blog)

The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.

Friday, October 21, 2011

Friday roundup (10-21-11)

US and China call for action on eurozone debt crisis: Wen Jiabao lectures EU leaders on the need for structural reform but they will make no decision until summit next week (The Guardian)

EU Confronts Deteriorating Greek Economy as Six-Day Crisis Marathon Starts (Bloomberg)

France Retreats in German Clash Over Bailout Fund Leverage (Bloomberg) Italy vs France: Silvio Berlusconi frustrates French push on ECB and the bailout fund (The Independent)

France Likely to Lose Top Rating in Stressed Economic Scenario, S&P Says (Bloomberg)

EU eyes 50-60 percent Greek haircut for sustainable [level of debt]: Troika (Reuters)

Europe’s Undercapitalized Banks (The Big Picture blog)

Obama announces that all U.S. troops in Iraq are coming home: President Obama says that the 40,000 U.S. troops will be 'home for the holidays,' fulfilling a campaign promise and acceding to the reality of a depleted treasury and overwhelming public opinion. (The Los Angeles Times)

America at Stall Speed? by Mohamed A. El-Erian -- "Stall speed is a terrifying risk for an economy like that of the US" (Project Syndicate)

Fed Official Hints at Possible Effort to Boost Economy (The Wall Street Journal)

Payrolls Declined in 25 U.S. States, Led by NC (Bloomberg)

Student Loan Bubble To Exceed $1 Trillion: "It's Going To Create A Generation Of Wage Slavery" And Another Taxpayer Bailout (ZeroHedge blog)

Suprised That Obama Tapped Inflation Hawk Hoenig for the FDIC? Don't Be (The Atlantic)

Volcker Rule, Once Simple, Now Boggles (The New York Times)

[Former] Top Fraud Prosecutor [William K. Black]: The Criminals Can Be Forced to Disgorge their Ill-Gotten Gains INCLUDING Bonuses (Washington's Blog)

Regulators close four more U.S. banks -- " bringing the total number of closures this year to 84" (Reuters)

Decatur First Bank of Decatur GA had a troubled assets ratio of 443.7%. (BankTracker)

Old Harbor Bank of Clearwater FL had a troubled assets ratio of 496.9%. (BankTracker)

Community Capital Bank of Jonesboro GA had a troubled assets ratio of 560%. (BankTracker)

Community Banks of Colorado of Greenwood Village CO had a troubled assets ratio of 212.4%. (BankTracker)

The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.

Thursday, October 20, 2011

Thursday roundup (10-20-11)

European debt crisis talks plunged into chaos as leaders announce another summit: Plans to "decisively address" the debt crisis this weekend were plunged into chaos on Thursday night as European leaders were forced to announce another "summit" next week amid political deadlock between France and Germany. (The Telegraph) Franco-German split over bailout fund threatens crisis plan (Reuters) Euro bailout plan delayed by Berlin-Paris row: Merkel and Sarkozy at loggerheads over French proposal for bailout fund to become $2tn 'bank' overseen by ECB -- [Sunday's summit in Brussels will be "followed by a second summit next Wednesday"] (The Guardian) Merkel et Sarkozy reportent à mercredi la conclusion du plan de sauvetage de l’euro -- "Voici le communiqué intégral publié par l'Elysée" (Le Monde blogs)

Are we headed for another Lehman moment in Europe?: With the Eurozone crisis heating up, protests getting violent in Greece and rating agencies renewing their downgrades of PIIGS nations, what does all of this mean for some of Europe's biggest banks that are most exposed to these countries? Are we headed towards another banking crisis, this time in Europe? Where will it start, and can contagion reach the US? You are going to be shocked to find out what entrepreneurial investor and independent analyst Reggie Middleton says US taxpayers could be on the line for. (Russia Today)



Europe’s new bailout fund takes shape: What draft shows (Bloomberg) Sedan again as Germany imposes terms (The Telegraph blogs)

S&P sees downgrade blitz in EMU recession, threatening crisis strategy: Standard & Poor's (S&P) is to warn that a double-dip recession in Europe would imperil France's AAA rating and set off a string of downgrades across Southern Europe, undermining the EU's debt crisis strategy. (The Telegraph)

Troika Says Greek Debt Not Sustainable (The Wall Street Journal)

New Greek bailout cash comes with dire warning: International inspectors forecast Greek debt will reach 181 per cent of GDP (The Independent)

EFSF Scheme Means France Absolutely Must Keep AAA Rating (The Wall Street Journal blogs)

Chart of the day: Italian bonds back over 6% (Credit Writedowns blog) "If the Italian 10 year surges over 7% (the so-called breaking point for their fiscal situation), then the whole game gets kicked to a new level." (Pragmatic Capitalism)

U.K. Consumer Confidence Falls for Fourth Month, Nationwide Says (Bloomberg)

Bank of Japan Sees Persistent Deflation (The Wall Street Journal)

Fed debate about more easing heats up (Reuters)

Consumers Most Negative on U.S. Economy Outlook Since Recession (Bloomberg)

Americans Grow More Negative About Their Personal Finances: Nearly half say their financial situation is "getting worse," similar to early 2008 (Gallup)

AP-GfK Poll: Hope weak for economy, Obama remedies (The Associated Press)

The Coming Derivatives Crisis That Could Destroy The Entire Global Financial System (The Economic Collapse blog)

House Price Indexes show price declines in August (Calculated Risk blog)

Builders to deliver record low number of housing units in 2011 (Calculated Risk blog)

Commercial Real Estate Deals Decline as U.S. Rebound Cools (Bloomberg)

Federal Reserve Board Rife With Conflict of Interest, GAO Report (ABCNews) Non-Partisan Government Report: Federal Reserve Is Riddled with Corruption and Conflicts of Interest (Washington's Blog)

Senior S & L Prosecutor: Bank of America Pulling a Decades-Old Scam (Washington's Blog)

[Cook] County budget to have 1,000 layoffs, sales tax cut (The Chicago Tribune)

Northrop Grumman to shed 800 jobs (Marketwatch) Northrop Grumman to cut 800 jobs, most in Md.: Cutbacks could be repeated by other defense contractors (The Baltimore Sun)

The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.

Is it a recovery yet? (Weekly report, 10-20-11)

A recovery would be indicated by weekly initial jobless claims holding below 500,000. (See this post.)

IT'S A RECOVERY! (And it has been a recovery for every week since the Nov. 25, 2009 report, with the exception of the Aug. 19, 2010 report.)

"Jobless claims dropped by 6,000 to 403,000 in the week ended Oct. 15, Labor Department figures showed today in Washington." (Bloomberg)

SEE LAST WEEK'S POST HERE.

The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.

Wednesday, October 19, 2011

Wednesday roundup (10-19-11)

Some Euro Countries Bankrupt, King Warns: The Governor of the Bank of England has warned that "time is running out" for the UK and global economy. (Sky News) Europe Faces Solvency Crisis, Warns Governor (Sky News blogs) King Says ‘Time Is Running Out’ in Battle With Imbalances, Debt (Bloomberg)

Eurozone crisis could cause collapse of global banking system, warns Citigroup's Willem Buiter: The world banking system could collapse if eurozone leaders fail to curb the region's sovereign debt crisis, according to Citigroup's chief economist Willem Buiter. (The Telegraph)

Eurozone collapse would make Lehman Brothers collapse 'look like a minor blip' warns Lord Wolfson (This is Money)

World Bank chief urges "definite steps" by Europe -- "The head of the World Bank on Wednesday warned there was not a lot of room for error" (Reuters)

Euro leaders warned over bank capital: Analysts see no end to eurozone crisis without rapid recapitalisation of troubled sector (The Independent) Dexia: the end of a crisis or the beginning? (The Washington Post)

Franco-German deadlock over ECB’s role in rescue fund: French president Nicolas Sarkozy has raised the stakes dramatically in Europe's debt crisis. -- "'If there isn't a solution by Sunday, everything is going to collapse,' he told his inner circle ..." (The Telegraph) Sarkozy says euro zone talks stuck on bailout fund (Reuters) EU leaders struggle to overcome debt talks difficulties (The Irish Times)

Merkel Risks Own Downfall as Odyssey to Save Greece Nears Climax (Bloomberg)

UK Recovery Off Track: Bank of England Chief (The Financial Times) Osborne Faces 16 Billion-Pound Budget Hole, U.K. Survey Shows (Bloomberg)

Great Recession may not yet be even half over, study says (The Globe and Mail of Toronto) The Statistical Behavior of GDP after Financial Crises and Severe Recessions by David H. Papell and Ruxandra Prodan, University of Houston (The Federal Reserve Bank of Boston)

Supercommittee’s lack of progress on debt reduction raises alarms on Hill (The Washington Post) Deficit Panel May Need Push, Lawmakers Say (The New York Times)

Student Loan Debt Hits Record Levels (USAToday)

AIA: Architecture Billings Index [a leading indicator for commercial real estate] declined in September (Calculated Risk blog)

MBA: Mortgage Purchase Application Index at Lowest Level Since 1996 -- " suggests weaker home sales in November and December" (Calculated Risk blog)

Gloom Grips Consumers, and It May Be Home Prices (The New York Times)

Fraudclosure Errors Destroying Americans’ Property Rights (The Big Picture blog)

Bank of America Deathwatch: Moves Risky Derivatives from Holding Company to Taxpayer-Backstopped Depository (Naked Capitalism blog)

Citigroup to Pay Millions to Close Fraud Complaint (The New York Times)

"99% Of The Population Has Lost Political Representation": October 17, 2011 MSNBC (Youtube)



Nassim Taleb on Wall Street Protest, Banking (Bloomberg)



Chris Hedges [who a decade ago was part of a Pulitzer Prize winning team of journalists for The New York Times]: "This one could take them all down." Hedges on OWS w/ OccupyTVNY -- 10/15/11 (Youtube)



Checkpoint expands restructuring to cut 1,000 jobs (The Philadelphia Inquirer blogs)

Panasonic to cut plasma TV panel production [and about 1,000 jobs]: report (Reuters)

Aviva to cut up to 950 jobs in Irish jobs blow (Reuters)

The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.

Tuesday, October 18, 2011

Tuesday roundup (10-18-11)

French, German disagreement endangers deal on second Greek bailout at summit (The Associated Press)

Merkel Says EU Summit to Be Important, Not Final, Step in Resolving Crisis (Bloomberg)

German Economic Expectations Worsen (The Wall Street Journal)

French credit review threatens euro zone rescues (Reuters) France’s Ratings Pressure Handicaps Sarkozy in EU Crisis Talks (Bloomberg) French economy fears push debt yields to 19-year high: Concerns over the health of the French economy in the event of further European sovereign bail-outs saw yields on the country's debt spike to their highest level relative to Germany's since 1992. (The Telegraph) Moody's warns France on possible negative outlook (Reuters)

Saving the Euro Might Bankrupt France (Forbes)

Greek Debt Writedown of 100 Percent Needed: Analyst (CNBC)

Moody's Downgrades Spain's Bond Rating by Two Notches (Reuters)

EU Warns Portugal on Deficit (The Wall Street Journal) Rehn Says Portugal Has ‘Significant Challenges’ on Budget (Bloomberg)

S&P Lowers Rating on Monte Paschi, 23 Other Italian Lenders (Bloomberg)

Preoccupied by Wall Street: The Federal Reserve's stimulus moves have backfired, boosting the stock market instead of the economy. (Barron's blogs) Did QE2 Cause the (Present) Recession? (The Big Picture blog)

Debt-Serfdom Is Now the New American Norm by Charles Hugh Smith -- "The typical American household is insolvent: its debts exceed its assets." (Of Two Minds blog)

The Federal Reserve and Bank of America Initiate a Coup to Dump Billions of Dollars of Losses on the American Taxpayer (Washington's Blog) HOLY BAILOUT - Federal Reserve Now Backstopping $75 Trillion Of Bank Of America's Derivatives Trades (The Daily Bail blog)

Volcker Rule Risk Concentrated in 25 Banks (The Big Picture blog)

Ellen Schultz: Investigative reporter Ellen Schultz talks about how corporations deliberately deceived their employees and Congress to profit from workers' pensions. (The Daily Show with Jon Stewart)


The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.