David Beers, head of sovereign ratings at S&P defended the actions of his firm saying, “we take our responsibilities very seriously and if at the end of our analysis the committee concludes that a rating isn’t where we believe it should be, it’s our duty to make that call.” Okay, I can respect that fact, [...]
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Advice for Congress on Dealing with the Debt Ceiling
The United States Congress has been locked in a battle of ideals focused on raising taxes and cutting spending with the obvious goal of achieving fiscal sustainability. On Friday President Obama stated “I have not seen a credible plan, having gone through the numbers, that would allow you to get $2.4 Trillion in proposed spending [...]
The Dark Side of the OECD Oil Inventory Release
We are re-posting an article from Gregor MacDonald, who is a well known oil analyst and energy sector investor, on the implications of the release of 60 million barrels of oil from the OECD inventories: “IEA in Paris announced this morning a release of 60 million barrels from OECD inventories. The implications of this extraordinary [...]
Special Update on Greece courtesy of Deutsche Banks’s Jim Reid
Deutsche Bank credit strategist Jim Reid has been on fire lately with his assessment of the Greece situation. In his latest note he offers what’s perhaps the most compelling comparison yet between Greece and Lehman: It’s difficult to continually kick the can down the road when the can is breaking up in front of your [...]
Double Bogey In This Balance Sheet Recession
Much is written, albeit off cue, as it relates to the future health of the U.S. Economy in 2011 and beyond. There are of course countless highly intelligent and experienced analysts and strategists who seem to have debated every angle of well known structural headwinds from the Japanese earthquake and its effect on vital supply [...]
Perception is everything… Or Is It?
A disturbing disconnect has recently developed between the perception of the US economy and what many data sources tell us is the reality. The perception is of course that the stock market rally, which began in March of 2009, was justified in the fact that the economy while fragile, was certainly on a clear path [...]
“Funny Farm” the appropriately titled 1988 film which starred Chevy Chase is being played out on Wall Street starring Ben Bernanke.
Chevy Chase plays Andy Farmer, a sportswriter who quits his job and buys a house in the country, where he plans to write a novel. The movie takes us through all four seasons in the small town of Redbud, Vermont, but it ends during the holidays when the Farmers’ charming Cape Cod is decorated with [...]
GDP Revisions Forthcoming
This morning’s durable goods number fell .9% in February versus an expected gain. This disappointment comes after the January decline of 6% which was the biggest drop in two years. Most economists had blamed the January decline on weather. Manufacturing has been a significant source of strength in this recovery, and most economists do expect [...]
Japan, Libya and the Global Economy
The ongoing tragedy in Japan and crisis in Libya are certainly large scale catastrophes, the impact of which is many faceted to be sure. While I have read many respected analysts up to the minute assessments of economic impact, for an accurate economic perspective I think it best to wait and watch as the scope [...]
Inflation, interest rates, and the China – U.S. Power Struggle
Much is written and spoken today about the potentially crushing wave of inflation and rising interest rates that the U.S. will soon experience, most of it is seriously flawed in its assumptions. The not soon to be repeated again simultaneous actions of interest rates and inflation that the U.S. experienced in past decades was the [...]