Commentary

Market commentary

Credit Card Act of 2009

14 years ago
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Herea are some provisions that take effect in February 2010 Must give 45 days notice before raising interest rates. Must apply payments to the highest interest rate balance first. Minors (i.e., under 21) must have a cosigner or prove they have sufficient income/assets.  Credit limit cannot be [...]

Economy Recovering?

15 years ago
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With the market up over 27% from its lows last Friday and lots of positive earnings surprises there is almost a viceral buzz building of people hoping it is a sign that we have hit bottom and things will start to get better. From an economic standpoint this is almost certainly untrue.  While things [...]

Unemployment — Going Where? Which Means?

15 years ago
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 The March Employment Report is out. This graph from CalculatedRisk shows the job losses from the start of each employment recession of the last 60 years in percentage terms (as opposed to the number of jobs lost). The trend shows that as we have moved away from a manufacturing dominated economy [...]

Pensions Dramatically Increased Risk Over 50 Years

15 years ago
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Over the last 50 years public pensions have gone from negligible equity exposure to averaging over 65% equity exposure with another 10% in alternative investments and only 25% remaining in bonds before the latest down turn. This is going to hit the states and municipalities the hardest over the [...]

Fruadulent Transactions Made Real?

15 years ago
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I just finished reading Chris Whalen’s piece on AIG and the implications leaves me speechless. Here is the gist.  Before credit default swaps came into vogue, insurance companies would create reinsurance contracts with each other.  Reinsurance is simply one insurance company transferring some of [...]

Public-Private Investment Program – More Taxpayer Looting

15 years ago
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The Treasury Department has released details on the Public-Private Investment Program (PPIP) to help remove toxic assets from bank balance sheets.  Unfortunately, I see this as a further transfer of taxpayer dollars to Wall Stree (around a trillion dollars). Here is the way it works.  For every [...]

Fuel Use by Mode of Transportation

15 years ago
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The following graph shows how many gallons of fuel it take to travel 350 miles using different modes of transportation.  Beware of one sleight of hand.  When the graph gets to the SUV, cars and hybrid it no longer divides by the number of passengers (i.e., it is assuming only one person in a car). [...]

AIG – The New Marshall Plan

15 years ago
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Image by Mike Licht, NotionsCapital.com via Flickr As the AIG bailout goes north of $160 billion dollars, I have been trying to figure out who this money is really supporting.  The latest round of money illuminated that a major thrust was on maintaining AIG’s AAA rating.  A number of people [...]

Understanding a Trillion Dollars

15 years ago
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Numbers like a trillion are way beyond our every day comprehension.  With the economic crisis taling about trillions has become common place and James Hamilton has come up with the following to help make the numbers more real. A trillion dollars is about the total amount collected in income taxes [...]

2/24/09 Housing Update

15 years ago
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The latest Case-Shiller monthly Home Price Indices for December came out today.  Home prices have continued to fall.  If we look at housing costs through a variety of metrics we see that we are just starting to get down to the level of previous highs.  To get back to historical average valuations [...]
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