Mish always highlights the "meat" of a post, as he has done in More Prime Defaults. [more]
Seems to me that an evaluation of economic history shows that Keynesian economics tends to always end with massive debt and a heap of hurting and bubbles. This run has been one of the longer runs of this stupidity. Austrian economics makes much more sense to me.
Keynesians please exit stage left.
How much of your future needs have you bought today with debt?
Really, this is what I looked at with my students in math today. [more]
I am still sitting on the sidelines as I still believe the worst is not behind us. The next wave of foreclosures to be dealt with are the ones coming from the job losses. I think it will be interesting how this wave gets dealt with when the markets have already been through incredible stress. [more]
This CR post is couple days old now, but it goes nicely with my last post questioning what happens now that the FDIC deposits have been wiped out. [more]
Market Ticker's post on bank failures, the last bank failure, BankUnited, is costing the insurance $4.9 billion. [more]
I have seen a couple posts on economic decline in China, one from naked capitalism. [more]
Leo Kolivakis has an excellent post that looks at the triple hit to the markets, The asset decline is the housing market is about 1/3rd and comparable to the 1930s. An interesting point is that some people still expect the market to recover to what they paid kind of thing and over time people will adjust spending to their beliefs of their level of wealth. [more]
Wow, S&P trading at a P/E of 122 now????
Look at these charts on Big Picture.
Mish has a post about how wholesale prices are declining, but what got my attention in the post is that it is the second time recently that I have read about increasing oil storage happening. That means that oil is not being consumed and when storage capacity runs out it should put downward pressure on oil prices. It is interesting that prices have increased when there is so much demand destruction. I speculate that in the shorter term that some businesses figure it is better to store it when they have the capacity to store it and prices are low relative to the recent price bubble. [more]
I really had not followed the details of the stress test but Big Picture did a post on the stress test leverage, 25 to 1!!!!! [more]
CR has a post pointing out the largest decline in history of revenue per room for the hotel industry. [more]
I posted earlier on the swine flu and my concerns that come because I am an educator and disease is simply spread faster through children than adults because of their behaviour, not washing hands as frequently, and simply touching everything all the time. [more]
Here is a post by Thomas Tan that outlines how banks have manipulated profits. [more]
Early in this financial crisis I put myself in the deflation camp and I have stayed here, but I do keep my eye open for anything that might change that. So far I do believe we are seeing deflation. [more]
It has been a very long time since I have actively made much in the way of picks. My expectation of the market is that it would go through a series of ups and downs and the downs would be bigger then the ups so even though there would be short periods when one can gain, like right now, ultimately I think it is still heading lower. [more]
I am still looking at pension issues. Obviously I am thinking they are going to play out huge in the economy. [more]
It seems to me that the answer to this question for most people is for a home or retirement, and these are both areas in the economy that have become disasters. [more]
Mish has a post about the ARMS resets. This is where people opted into short term mortgages at low rates and for a while were looking at huge increases in payments when their terms expired. The current low rates means that these people are no longer looking at increases and may actually see increased debt reduction as more of their payment goes to principal. [more]