News round-up: 20 Aug 2008

Top billing
Banks’ losses and capital: The new version of the paradox of Achilles and the tortoise – VoxEU
This is a post right down my alley. You’ve probably seen my list of Bloomberg’s writedown/ capital raised tally. Well, there is a gaping hole of $150 billion in that list. Where is that money going to come from? It’s not coming at all. Banks will deleverage and that means tight credit. No credit = no growth.

Exclusive Interview: Jim Rogers Continues to View China as the World’s Best Long-Term Profit Play – Money Morning (see part 1 in yesterday’s round up)

Financial institutions
Barclays sees potential in US – FT (Apparently, Barclays is confident enough about future losses in the U.S. and the UK to talk about buying companies. I thought they were forced to raise shed loads of capital in a poorly subscribed rights issue.)
Freddie pays highest risk premium – FT (a spread of 113 beeps over Treasuries)
Lehman writedown may hit $4 bln: J.P. Morgan – MarketWatch (psst, I smell panic)
Goldman Sachs tells investors not to buy into AIG – Reuters (psst, did you hear what I sad, panic)
JPMorgan Warned California as Auction Market Neared Collapse – Bloomberg
Fed’s Lacker Clashes With Paulson on Fannie-Freddie Strategy – Bloomberg (thank you)

Inflation/Deflation report
Inflation: Bank’s Besley defends 5% interest rates – Guardian (The BoE has some hawkish chops)
Wholesale prices rising at fastest pace since 1981– LA Times
German goods prices rise at fastest since 1974 – Times Online

US: Single Family Housing Starts Hit 17-Year Low – Housing Wire
What You Get for … $500,000 – NY Times

Odds & Ends
On Rodeo Drive, the economy’s booming – LA Times
Toyota reportedly set to announce price hikes – MarketWatch (price hikes in Japan, silly)
MSNBC Changes Prime-Time Lineup – NY Times (ladies First: Abrams out, Rachel Maddow in)
Madonna’s Bra, Clapton’s Guitar Targeted by Art Investor Funds – Bloomberg
In Uruguay, at Home on the Beach, and in the Country – NY Times (I visited Uruguay back in 2003 after the Argentina collapse. Things were tough then, but it is a great place)

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