The news yesterday was pretty grim as Japanese, Chinese, Eurozone, UK and U.S. manufacturing sectors all showed significant weakening. Combine this with an acknowledgment that we have been in recession for one year already and Meredith Whitney sounding the alarm bell for even worse yet to come and you get a steep sell-off in equities and a huge rally in Treasuries. One should note that Ben Bernanke sounded very dovish yesterday, putting paid to my post on quantitative easing and contributing to the rally in Treasuries.
Below are a few stories on the Internet that I would like to highlight. See the bulk of the news stories over at the news feed, which gets updated continuously.
BBC NEWS | Business | China factory output down sharply (Like I said, manufacturing is plummeting everywhere)
Credit-card industry may cut $2 trillion lines: analyst | Reuters (You know, I got a letter just yesterday from Citibank UK telling me they reviewed my account and noticed I was no longer a UK resident so they were canceling my Citicard. I haven’t been a UK resident for a number of years, Citi. This is just an excuse to limit their credit card liability and is a perfect example of what’s coming down the pike. Citi is rubbish if you ask me.)
Arnold Schwarzenegger warns California is almost broke – Telegraph (I told you these guys were broke)
Bloomberg.com: States Seek Aid as Budget Gaps May Hit $200 Billion (More municipalities are going to go bust too. Watch your muni investments.)
Bloomberg.com: Treasury Yields Drop to Record Lows as Bernanke Cites Buybacks (Helicopter Ben in full effect
FT.com – New U.S. administration tilts towards hawks (See my comments about Clinton’s saber-rattling and hawkishness during the primaries)
FT.com – Trump faces Deutsche suit over Chicago tower (I think the Donald is a blowhard who trades on his name more than his business acumen)
Buffett’s Approach to Investing is Dead: Dr Doom – CNBC.com (Don’t count Buffett out but give Marc Faber, Dr. Doom, a look)
Doris Dungey, 47, Financial Blogger Known as Tanta, – Obituary (Obit) – NYTimes.com (Tanta was a prolific blogger who will be missed. See these odes to her on Calculated Risk and from John Hempton)
Is Lehman CEO Dick Fuld the True Villain in the Wall Street Collapse? — New York Magazine (Tell me what you think: villain or victim?)
Bloomberg.com: Countrywide Sued by Fund Over $8.4 Billion Loan Deal (Tell me, who was the fool who allowed BofA to do the deal for Countrywide?)
UK Bubble: the explosive growth of the Bank of England balance sheet (The Brits may do a bit of quantitative easing I reckon)
INO TV (Good trading platform: As a INO TV subscriber, you have unlimited access to a huge digital library of trading seminars. There’s no limit on how many video or audio seminars you can watch or listen to.)
Deficits and the Future, by Paul Krugman, Commentary, NY Times (Hat Tip – Mark Thoma; this happens to be exactly what I said. It’s good to know a nobel laureate is singing the same tune.)