Global Cardiac Arrest

John Burbank of Passport Capital appeared at the Value Investing Congress this morning. I'm getting inured to scary prognoses at this point, but he managed to scare me by saying that GE, which is having difficulty rolling over its paper, and which has 22 times as many assets as it has tangible equity, is "at great, great risk of going bankrupt".

"The global capital markets system has had a heart attack," said Burbank, "and the policymakers are prescribing exercise and vitamins." If they really want to unblock things, they'll need to try something much more drastic: Burbank was...

Continue-reading...

Daily Brief

There is a lot of anger out there over the financial crisis. The need to direct that anger at someone, the credit crunch equivalent of a Charles Keating or a Michael Milken, is palpable.

But the hunting season is already out of control: A skit on Saturday Night Live advocated the murder of an elderly couple.

The skit, mocking the $700 billion bailout package passed by the House on Friday, portrays a C-Span news conference with House Speaker Nancy Pelosi. She introduces as victims of the credit crisis, Herb and Marion Sandler, who built Golden West into a California savings...

Continue-reading...

No specifics from Darling, as the markets nosedive

So there we have it - at close, the FTSE share index had dropped by 7.85 percent, its largest one-day fall since 1987.  The banks were, predictably, the big losers.  HBOS plummeted by 20 percent; the Royal Bank of Scotland by 20 percent; and Barclays by 15 percent.

Meanwhile, Alistair Darling gave a statement in Parliament (watch it here) which was full of the same obfuscating language that Angela Merkel's been employing recently.  Will the Government provide a 100% guarantee for all UK savings?  Hm, it's hard to tell.  Apparently, they'll take "whatever measures are necessary to maintain...

Continue-reading...

Exciting times indeed!

And throwing up the most unexpected surprises. Such as a decent Larry Elliott piece on matters economic..and in The Guardian no less.

At the heart of his argument about the European problems is that monetary unions don't last without political union. Thus this halfway point, this monetary union alone, isn't a stable position. We must either move forward to full political union (most importantly, fiscal union) or retreat, back to national currencies, where the monetary and political areas are the same.

Now given my vehement euronihilism (a more extreme variant of euroscepticism, it's the belief that the very existence...

Continue-reading...