Monthly Archives: November 2007

Chart of the Day: Sock Manufacturing in the US

Pie charts are generally anathema to Tufte-heads and other connoisseurs of chartistry: they use far too much space to convey far too little information. But I like the one at the right, from an NPR story about Fort Payne, Alabama … Continue reading

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And You May Find Yourself in a Beautiful House…

One of my favorite bloggers ventures into political-economy territory: was the subprime-mortgage bubble responsible for the re-election of George W Bush in 2004? I wonder if the mortgage and credit debacle is a clue. Could it reveal one of the … Continue reading

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Welcome Andrew Clavell

After writing yesterday’s post about the coupon on Citi’s mandatory convertible, I stuck around Andrew Clavell’s new blog, Financial Crookery, to see what else he’d written. And boy is this guy excellent: I’ve already added him to the blogroll, despite … Continue reading

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Extra Credit, Wednesday Edition

Simons at Renaissance Cracks Code, Doubling Assets: Jim Simons grants an interview to Bloomberg’s Richard Teitelbaum. CPDOs Bloodbath [continued] Subprime Near a Bottom? Most bonds have a natural recovery value of at least 20 cents or so. Low-tranche subprime RMBS? … Continue reading

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Why Citi’s 11% Coupon Doesn’t Mean it’s Paying Junk Rates

I didn’t actually post my first entry of the day at 10:20 this morning, honest: Movable Type seems to have eaten my real first post, about the Abu Dhabi investment in Citigroup. My blog entry compared the 11% coupon on … Continue reading

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The Future(s) of House Prices

The UK has a new tradeable derivatives contract on house prices, which shows house prices falling by 7% next year. That has Tim Harford worried: futures markets are "better than cheap-talk forecasts" in terms of being right, he says. But … Continue reading

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Meme of the Day: The Sudden Stop

Brad Setser started it, back on November 19: Bottom line: private demand for US financial assets has disappeared. In emerging market terms, the US has experienced a sudden stop. Yves Smith picked up the ball, as did Wolfgang Munchau: "financial … Continue reading

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Countrywide’s FHLB Bailout

I agree with Chuck Schumer and Nouriel Roubini that the $51 billion lent to Countrywide by the Federal Home Loan Bank of Atlanta smells very fishy. Yes, it’s collateralized by $62 billion in mortgages, and it’s entirely possible that FHLB … Continue reading

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The Really Big Picture

You wait years for a magisterial overview of the entire global economy on a thousand-year timescale, and then two come along within a week of each other. Angus Maddison’s Contours of the World Economy 1-2030 AD: Essays in Macro-Economic History … Continue reading

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Cybershoppers Bring Down Yahoo

The WSJ tells us today that "Yahoo’s popular e-commerce system buckled under the strain of a surge in online shopping" starting at the ridiculously early hour of 5:30 a.m. EDT yesterday. Help me out here: isn’t the point of "cyber … Continue reading

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Capital Infusion Datapoint of the Day

Coupon on the convertible bonds Bank of America bought to help shore up Countrywide: 7.5% Coupon on the convertible bonds Abu Dhabi bought to help shore up Citigroup: 11%

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Extra Credit, Tuesday Edition

InTrade fee structure discourages selling the tails? Sweatshops, sweatshops everywhere CDO Dumping Ground Still Sinking Where Is the Fed? "Way, way behind the curve." The end of the world’s nastiest democratic politician: "I wondered when Gordon Brown became prime minister … Continue reading

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Consumers Should be Able to Choose Their TV Channels

Joe Nocera had a provocative column in the NYT on Saturday, headlined "Bland Menu if Cable Goes à la Carte". We shouldn’t be allowed to pick and choose the TV channels we want to watch, he says: that would be … Continue reading

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Why Starbucks is Good for Small Coffee Shops

Yesterday’s NYT ran two almost idential "little coffee shop versus Starbucks" stories. Peter Applebome was in Little Falls: Mrs. Mallek was a bit taken aback when she saw two of the regulars — the regulars! — near her shop, Starbucks … Continue reading

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How Coventry First Threatens Life Insurance’s Tax Exemption

Today’s WSJ has a very good article on the fast-growing secondary market in life insurance policies, centering on the asset class’s undisputed leader, Coventry. It mentions that this market is objected to by the life insurance industry: Life settlements also … Continue reading

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Welcome Colin Barr

As part of the relaunched Fortune.com, Colin Barr has now joined the ranks of MSM finance bloggers. His blog is called Daily Briefing, and it looks to be a useful resource. I’ve already added him to the blogroll.

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Meme of the Day: Liquidity Puts and CDOs

Are you sick of the liquidity put yet? You shouldn’t be, because it’s only getting more and more interesting. There are three articles worth reading on the subject today, starting with David Reilly’s WSJ column on whether Citigroup should move … Continue reading

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More Questions Than Answers in CPDO Default

Now that financial reporters are back to work after the Thanksgiving holiday, I’m hoping that somebody will write a story about the CPDO which defaulted last week. The Reuters story raises more questions than it answers, foremost among them the … Continue reading

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Dubious Statistics Watch: Thanksgiving Retail Sales

Bloomberg News seems to be running two stories – on the same subject, and by the same authors – at the same time. The first has quite an apocalyptic headline: "U.S. Consumers Spent Average of 3.5% Less on Shopping". Which … Continue reading

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WSJ Admits its Merrill Story was False

Do you remember those heady days at the beginning of November when the WSJ went on the warpath? First there was the failed take-down of Jimmy Cayne (he plays golf!), and then, the next day, came a front-page article by … Continue reading

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Andrew Lahde: The Hedge Fund Manager With a 1000% Return

To the pantheon including subprime shorter John Paulson and Amaranth vanquisher John Arnold we should probably now add Santa Monica hedge fund manager Andrew Lahde. Lahde almost certainly hasn’t reached the billion-dollar-a-year club, but he does now officially oversee a … Continue reading

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Ben Stein Watch: November 25, 2007

Ben Stein’s NYT column is called "Everybody’s Business". Today he uses all of its 1,150 words to eulogize a Hollywood restaurant about which Citysearch says that "larger-than-life prices make it a ticket few can afford". He also manages to drop … Continue reading

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Extra Credit, Weekend Edition

UBS debt deal loses 90 percent on financials-Moody’s: A CPDO blows up. Oil: Key players and movements Megachurches Add Local Economy to Their Mission: "The Evangelical Christian Credit Union in Brea, Calif., a pioneer in lending to churches and a … Continue reading

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Hedge Funds and the “Buy Stuff That Has Gone Up a Lot And Cross Fingers” Strategy

Did you really think I was going to leave you for the weekend to plough through a thousand words on LSS-backed ABCP backstops? I’m nicer than that. Instead, enjoy my man Baruch: If scurrilous gossip is true, and it normally … Continue reading

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Leveraged Super Senior Trades and the Liquidity Put

On Wednesday I said that the notorious "liquidity put", which was allegedly responsible for tens of billions of dollars in Citigroup losses, was "really nothing more than a CP backstop". Today we’re learning a lot about something known as leveraged … Continue reading

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