Archive for October, 2008

Handbasket Report — Financial News Section — Where There’s Smoke, There’re Mirrors

28 October 2008

As I watched the wild upswing of the American stock markets today, I was wondering what I was missing.

Luckily, I read The Automatic Earth blog (noted on our list on the right) almost daily.  Today’s entry started with a concise explanation of today’s market events:

Wherever I look this morning, Asia, Europe, Wall Street, I see journalists and analysts claim that bargain hunters are causing the rising stock prices. They’re not. There is something different going on.

Prices these days fall when and because large investors need to sell assets in order to get cash. Prices rise when large investors need to cover their shorts.

The investors involved in both cases are largely identical, though not entirely. It’s important to understand that while, obviously, price drops cause loss of capital, price rises are now the result of the same. Everybody still tries to hide their losses, but it’s getting much harder.

Becoming both more enlightened and more depressed used to take a lot longer before the Internet.



Que Sarah, Sarah?

22 October 2008

Who the hell is Sarah Palin anyway?

The MSM has given us a lot to choose from here: down home charmer, religious zealot, anti-feminist, superwoman, pure-at-heart-reformer, fashionista, flirt, ignorant hick, and so on.

Given my fondness for reading and rationality, I’m most incensed by her proud, often incoherent ignorance:

“Palin Can’t Name Any Man-Made Causes of Global Warming”

“Palin Tells Kids the Vice President ‘Runs’ Senate”

Since she’s repeating errors made early on, we can, I suppose, only deduce she’s even less curious about the world–the real world–than George Bush is.  And she makes even less sense: “Diagramming Sarah”

But I’m now braced for her senseless muttering, so it was the stupidity of her fashionista shopping spree that stunned me.  I should have seen it coming.  After all, she was a beauty queen.  And those expensive eyeglass frames were all over the MSM.  Certainly her GOP handlers should have seen this coming and barred the door.  But they didn’t.

So she spent something like 150k on clothes.  I smiled when I read this.  Looks like she’s no Pat Nixon in a plain cloth coat.

I hope I’ll sleep well tonight, dreaming of how this social gaff may well sour many of those who twittered positively about Sarah Sixpack.  Maybe I’ll dream of Sarah 1787 Chateau Lafite.

T.J. would probably like that dream.

In any event, I hope the spending spree will override my memory of Mark Greif’s litcrit commentary from November’s Harper’s.  In “Death and the Maiden” {subscription) Greif describes Palin as “indomitable,” “willing to sacrifice  each one of her children for her beliefs.”  Instead of loving motherhood, his image is of “blood and suffering.”  To him, “Her rude health is her means of service; above her hovers the spirit, the absent McCain, whose vaporous deathstruck presence, lost in the past has returned to shepherd all these sacrificial lambs.” Wonderfully creepy little piece.

So I now long for November 5, when–if the US populace has a shred of sense left–I will be able to go back to worrying about Argentina’s nationalization of private pension plans and global warming.


Ghost of Christmas Future

13 October 2008

So the hardy folks of Iceland are buying all they groceries they can. Could it be a major sale on Omega-3 fish oil that’s brought them all out?

Oct. 13 (Bloomberg) — After a four-year spending spree, Icelanders are flooding the supermarkets one last time, stocking up on food as the collapse of the banking system threatens to cut the island off from imports.

Ah well, they can live off the land, just like we will, right?

Bonus, a nationwide chain, has stock at its warehouse for about two weeks. After that, the shelves will start emptying unless it can get access to foreign currency, the 22-year-old manager said, standing in a walk-in fridge filled with meat products, among the few goods on sale produced locally.

Things can’t really be that bad, can they? Am I just making this up, or exaggerating the problem?

Magnusson said last week that one of Iceland’s largest supermarket chains was unable to get any foreign currency to make purchases abroad and another retailer’s electronic payment didn’t go through. Iceland will begin to see shortages of “regular goods” by the end of the week if nothing changes, he said.

Sleep well,

Back in the Saddle Again

12 October 2008

Hey!  How are things with you?

Since I last posted, I’ve been–to borrow a Colbert line–busy rearranging the deck chairs on the Hindenburg.  Mine are slipping around a bit and a few are a bit warm, but all told they still look pretty tidy.  Our net worth is “only” down about eleven percent.  But I’m sure that’ll drop even more when–if?–the markets open again.

Oh well.  Things could be much worse.  Uh, make that things will be much worse.

But for now, I’m just cooking up and freezing vast quantities of tomato sauce and filling hanging baskets in the pantry with my shallots.  I’ll dig the carrots later.

In other words, I have a bit of free time to sympathize with others.  One friend has given up all hope of keeping her home of eighteen years.  Another is hyperventilating about a fifty percent drop in the market value of her retirement portfolio.  Others are worried about paying college tuition, finding/keeping jobs, or just filling their gas tanks.

At least those around me are now staring hard into the fog of the future.  Unfortunately though, now that most Americans are moving beyond passive fretting, too many are still avoiding introspection and analysis and seeking only scapegoats and excuses for inaction.

Hence we are seeing things like this: “President Osama?  U.S. Election Ballot Misspells Obama’s Name.”

And this: “Economic Woes Chill Effort to Stop Global Warming.”

I guess my deck chairs will continue to warm.



Looking for the Eye of the Hurricane

10 October 2008

I see only the storm.

From the BBC this morning-

One serious anxiety concerns the auction today to settle liabilities on insurance – or credit default swaps – on debt of the collapsed investment bank, Lehman Brothers.

So, after taking a second hot chug of chai, I read on.

And if that claimant had been calculating its own financial strength on the basis that it had insurance against its Lehman debt, well then failure to receive payment could shatter the integrity of its balance sheet. Which in turn would create potential losers among its creditors.

So this day of reckoning on Lehman credit default swaps is momentous – and it could not come at a worse time for fragile bank shares.

Forget the hurricane. What we have here is a chemical cascade- a series of multiplying steps of exothermic flow. Plywood on your windows isn’t going to help.