• How Times Have Changed
    Posted by on September 16th, 2008 at 10:35 pm

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    It was almost ten years ago that Time magazine ran a cover with Greenspan, Rubin and Summers called “The Committee to Save the World.” Let’s just say that I couldn’t imagine a similar cover running today with Bernanke, Paulson and Geithner.

  • The Black Swan Beats Up the Bear
    Posted by on September 16th, 2008 at 10:07 pm

    The oil boom of the 1970s was a great financial help to the Soviet Union. It helped fund their strategic acquisition, meaning Afghanistan, which didn’t go quite so well. Perhaps the invasion of Afghanistan was a sell signal for commodities since gold peaked a few days later.
    The invasion of Georgia may be playing the same roll. Money has poured out of Russia and oil has plunged over $50 a barrel. The Russian market plunged 17% today and the stock exchange was shut down.

    “It’s panic,” said Oleg Vorotnitsky, head of equity trading at Uralsib Financial Corp. in Moscow. “There are problems with liquidity on the market. People are having difficulties with refinancing their positions so they started selling. Concern about AIG” is adding to the panic, he said.
    The dollar-denominated RTS Index lost 11 percent to 1,131.12, marking a 55 percent retreat from its highest close of 2,487.92, on May 19. The gauge has fallen 51 percent so far this quarter, the worst performance of major world equities indexes.

  • AIG’s Move Today
    Posted by on September 16th, 2008 at 4:02 pm

    In today’s session, shares of AIG ranged from $1.25 to $5.24. Total volume was over 1.23 billion.
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  • The Fed Holds
    Posted by on September 16th, 2008 at 2:28 pm

    The central bank does nothing.

    The Federal Open Market Committee decided today to keep its target for the federal funds rate at 2 percent.
    Strains in financial markets have increased significantly and labor markets have weakened further. Economic growth appears to have slowed recently, partly reflecting a softening of household spending. Tight credit conditions, the ongoing housing contraction, and some slowing in export growth are likely to weigh on economic growth over the next few quarters. Over time, the substantial easing of monetary policy, combined with ongoing measures to foster market liquidity, should help to promote moderate economic growth.
    Inflation has been high, spurred by the earlier increases in the prices of energy and some other commodities. The Committee expects inflation to moderate later this year and next year, but the inflation outlook remains highly uncertain.
    The downside risks to growth and the upside risks to inflation are both of significant concern to the Committee. The Committee will monitor economic and financial developments carefully and will act as needed to promote sustainable economic growth and price stability.
    Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Christine M. Cumming; Elizabeth A. Duke; Richard W. Fisher; Donald L. Kohn; Randall S. Kroszner; Sandra Pianalto; Charles I. Plosser; Gary H. Stern; and Kevin M. Warsh. Ms. Cumming voted as the alternate for Timothy F. Geithner.

  • Growth Is the New Safe Haven
    Posted by on September 16th, 2008 at 1:07 pm

    Relatively speaking.
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  • 88 Years Ago Today
    Posted by on September 16th, 2008 at 12:16 pm

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    At 12:01, September 16, 1920, a horse cart packed with dynamite blew up outside 23 Wall Street, which was the headquarters of J.P. Morgan. Thirty-eight people were killed and 400 were injured. Pockmarks from the blast can still be seen on the building and the company has said that it will never been repaired. No one was ever charged.

  • Me on LEH in 2005:” I can’t put my finger on it, but I don’t see where all the growth comes from.”
    Posted by on September 16th, 2008 at 11:50 am

    At the end of 2005, I posted some thoughts for 2006 including a few stocks to sell immediately. One of the stocks I said to sell was Lehman Brothers:

    There’s something about Lehman Brothers (LEH) that I just don’t get. Every quarter they put up great numbers. I can’t put my finger on it, but I don’t see where all the growth comes from. How can they consistently do what others can’t? Maybe the company really is that good. Maybe not. Personally, I’m rooting for the yield curve.

  • Let’s Have a Commission
    Posted by on September 16th, 2008 at 11:38 am

    Good news! John McCain has a plan to fix the credit crisis, let’s form a commission!

    We need to set up a 9/11 Commission in order to get to the bottom of this and get it fixed, and act to clean up this corruption…They’ve violated the social contract that capitalism and the citizen have, and we can’t ever let this happen again. I’ll make sure it never happens again.

    Commissions are basically community organizers, but for nicer communities.

  • By the Way
    Posted by on September 16th, 2008 at 11:23 am

    My Buy List is up 0.58% today.

  • S&P 500 Daily Changes
    Posted by on September 16th, 2008 at 11:17 am

    Yesterday was the biggest sell-off since 9/11. Here are the daily changes for this decade.
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    The worst day came on April 14, 2000 when the S&P 500 lost -5.83%. The Monday after 9/11 (September 17, 2001), the market dropped -4.92%. Yesterday, the market lost -4.71%.
    The best day came on July 24, 2002 when the market jumped 5.73%. The second-best day came five days later when the market rose 5.41%.