• Sign of the Times
    Posted by on February 20th, 2009 at 10:52 pm

    Rep. Michael Capuano to the bank executives last week:

    Basically you come to us today on your bicycles after buying girl scout cookies and helping out Mother Teresa, telling us “We’re sorry, we didn’t mean it, we won’t do it again, trust us”…I don’t really have a question, but I was told that I can use my five minutes.

    In other news:
    Girl Scout cookie sales crumbling

  • Velkomme to Sweden
    Posted by on February 20th, 2009 at 1:32 pm

    I hate saying this, but we have to stop kidding ourselves—it’s time to nationalize our rotten banks. I’m not really pro nationalization but I’m anti stupidity and that’s what we’ve been doing up till now.
    My normal fear of nationalizing is that it would lead to a moribund industry incapable of turning a profit. Well, we’re already there.
    My only hope is that it’s done quickly. Very quickly. Before anyone notices.

  • Blast From the Past
    Posted by on February 20th, 2009 at 1:04 pm

    With the market at new lows, it’s time to recall some predictions. This is from January 2, 2008:

    Christian broadcaster Pat Robertson, who has made predicting the future an annual tradition, predicts a recession and a major stock market upheaval are on their way for the United States.
    Aside from a recession this year, Robertson suggested Wednesday that Americans will be paying much more for gas at the pump as the price of a barrel of oil rises by 50 percent in the coming months.
    Specifically, he said oil would reach $150 a barrel – the price hit $100 on Wednesday – with the dollar continuing to lose value in 2008.
    “I also believe the Lord was saying by 2009, maybe 2010, there’s going to be a major stock market crash,” said Robertson, who is a millionaire businessman as well as an evangelical leader.

    Not bad. Oil topped out at $147. The stuff about nuclear war? Well, unfortunately, that didn’t pan out.
    Still, that’s some pretty good predictioning from Pat. No wonder he came in second in the Iowa caucus.

  • Paragraph of the Day
    Posted by on February 20th, 2009 at 12:57 pm

    From Arnold Kling:

    Starting last September, our country has gone through six months that shook the world. We have abandoned free markets. We have abandoned democracy, in the sense of having policies that reflect the popular will. The United States has become a technocratic dictatorship.

  • How Things Have Changed
    Posted by on February 20th, 2009 at 1:18 am

    James Surowiecki from January 6:

    As I showed yesterday, investors overwhelmingly supported the Paulson plan: it was only when it was killed, that stock prices really started their downward spiral. And it was only after Obama unveiled his economic team and made clear how big his stimulus plans were that the market began its sharp recovery (the S. & P. 500 is now up twenty-five per cent since Nov. 20th).

    Surowiecki made what I call, the “Daniel Gross Mistake” which is to read partisan political opinions from stock market returns. January 6 turned out to be the exact near-term high. Since then, the S&P 500 is down 16.7%.

  • Stocks Hate the Dollar
    Posted by on February 20th, 2009 at 12:46 am

    A strong dollar used to be good for U.S. stocks, but since the credit crisis broke, that relationship has completely reversed itself.
    Here are some numbers: Starting from the beginning of 1999 and going through September 17, 2008, on days when the dollar has rallied against the euro, the S&P 500 was up an annualized rate of 34.9%. But when the dollar fell against the euro or stayed the same, the S&P 500 dropped by an annualized rate of 26.7%. Stocks clearly liked a strong dollar.
    Since September 18, the numbers are striking. On days when the dollars has rallied against the euro, the S&P 500 has fallen at an annualized rate of 95.7%. When the dollar has lost ground to the euro, the S&P is up by an amazing 747.5% annualized. Of course, that’s a much smaller sample size, but the early evidence suggests that stock investors now favor a weaker greenback.

  • New York Times Suspended Dividend.
    Posted by on February 19th, 2009 at 7:29 pm

    Not a big surprise:

    The publisher said in a statement today it suspended its quarterly dividend of 6 cents a share to help reduce debt, three months after slashing the payout. It joins McClatchy Co., owner of the Sacramento Bee, and Media General Inc. in halting dividends.
    The suspension will save New York Times about $34.5 million annually, based on shares outstanding. The publisher is cutting jobs and selling assets as advertising dwindles. It’s seeking buyers for its stake in the Boston Red Sox baseball team and is in talks about a sale-leaseback on its Manhattan headquarters.
    “It’s going to be very challenging for them to generate much free cash flow even after this cut,” said Mike Simonton, a credit analyst at Fitch Ratings. “It’s certainly a prudent move to preserve liquidity in light of the difficult credit market and their heavy debt burden.”
    New York Times fell 20 cents, or 5.4 percent, to $3.51 at 4:15 p.m. in New York Stock Exchange composite trading, before the announcement. The shares have declined 82 percent in the past 12 months.
    “Today’s decision provides the company with additional financial flexibility given the current economic environment and the uncertain business outlook,” Chairman Arthur Sulzberger Jr. said in the statement. The Ochs-Sulzberger family controls New York Times and has benefited from the dividend on its Class B stock.

    Here’s the Times opining against cutting dividend taxes in 2003.

  • Dow Closes at 6-Year Low
    Posted by on February 19th, 2009 at 4:35 pm

    The Dow closed today at 7,465.95, its lowest close since October 9, 2002. The Dow is off 47% from its high of 14164.53 which came on October 9, 2007.
    The Dow is now lower than where it was on June 9, 1997.
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  • Irish Bank Workers Spat Upon
    Posted by on February 19th, 2009 at 4:14 pm

    I hope your day is going better than this:

    Irish bank workers are being spat at and threatened with physical violence by customers who are incensed at scandals in the industry, a union said on Thursday.
    The IBOA, which represents over 20,000 workers in Ireland’s financial sector, said staff at banks had been facing growing abuse.
    “We are seeing this kind of abuse not just in the working day but even socially in the evening,” said IBOA general secretary Larry Broderick.

    Same thing happened to John Rambo after the Nam.
    (Via: Alea.)

  • Santelli Calls for Tea Party
    Posted by on February 19th, 2009 at 2:00 pm

    Grab your pitchforks. We have a leader.