Financial Roundup (Attention: Not for the Faint of Heart

Let's see what happy news we have today. This guy gives 30 reasons why we will be in Great Depression 2 by 2011 (Look at his picture. Why is he smiling?). Foreign autos are piling up at the dock in Long Beach (now that's a happy picture). George Bush sells us down the socialist river. The Washington Post must have received something from King Paulson to publish this piece of crapola article fawning about his exploits (many of them extra-legal), while President Bush cowered in the background. A more realistic look at King Paulson can be found here where we find proof that he is more concerned about how history sees him then anything else and so must rapidly revise the truth.

If You Have to Deny Rumors of Liquidity...

...in this financial environment, you are as good as saying that there are liquidity problems (this time in England).

Worse Than 1929?!?

Here's a nasty piece to ponder. Will it be worse than 1929? Search me, but it's pretty bad already and going to get worse.

More Fallout from the Banking Mess

Florida has a fund that invested in mortgage backed securities because the offerings were rated AAA and provided a higher return than a money-market fund. Unfortunately, the fund has lost money (with probably more to go) so all of the prudent municipalities have pulled their funding - a run on the fund - even though Florida denies it is a run. At any rate, look for those with money left to lose some of their ultra-safe investment.

Banks Try to Hide Losses

An interesting article analyzing the giant fund that banks have set up at the behest (and in cahoots with) the U. S. Treasury Department. A must read.

Hedge Fund Collapse

Two hedge funds are on the virge of collapse at Bear Stearns. It would take too long to explain all the ins and outs of this problem, but here is what you need to know. The banking industry (and government) in no way wants these funds to collapse because it will force the rest of the indsutry to revalue CDO's closer to their actual price (which is much lower than anyone is admitting). This will have a ripple effect across the industry up to and including more fund failures. Everyone is desperate to avoid this which is why Merrill Lynch, who threatened to grab what collateral they could from the two failed funds and sell them, ended up not doing so (presumably under heavy industry and government pressure). Where will it end up? It buys everyone a little time to salvage things. Whether or not they will be successful is anyone's guess. Once again an irresponsible hedge fund is bailed out by the government and industry!

The Next Finanical Meltdown

This is an article pointing back to the past for a possible template as to how a terrorist act might affect the financial markets. It has been obvious to me for a long time that the financial markets are under estimating the possibility of a nasty terrorist attack. Here's some evidence demonstrating how this happened on the eve of WW I.

Why Housing Will Cause a Recession

Yep. You heard it here. It is coming, no ifs ands or buts about it, not that you could tell from the financial press. Caroline Baum explains why in this piece. What goes up will eventually come down, especially when it has been inflated thanks to Alan Greenspan!

Headed For a Recession?

Yes we are thanks to Alan Greenspan's damaging policies. The question is when will it be and how bad will it be? Claus Vogt, a German bank economist lays out clear evidence for a coming recession in his article, "Soft Landing or Recession." Ben Bernanke over at the Fed is doing everything in his power to prevent the inevitable results, which will only delay the day of reckoning and make it worse. The outcome? Either rampant inflation or depression. Bernanke must "inflate or die." He may be successful, but the outcome will not change. Deep trouble for the American economy and those of us who live by it.