Housing optimism

While I am not particularly optimistic about house prices in the U.S. nationally over the medium term, a recent Washington Post article suggests that prices in the Maryland suburbs of DC are not suffering like other jurisdictions around the…

The TED Spread

Note: This post is from April 2008 but is updated from time to time to reflect charts of the current market conditions The TED spread is a common measure of fear and risk in the capital markets. Judging from where the TED spread is now…

Commercial Real Estate bust

The bubble built in residential housing is quickly moving to commercial real estate. It stands to reason that commercial real estate should suffer if residential real estate does. Yet, those same financiers who brought us the housing…

China’s bubble has popped

I f anyone doubted it, China's bubble has finally popped. The Shanghai Composite Index is down 50% from its highs in 2007. That is a massive downswing that must have broader consequences. Moreover, this is likely the result of a…

RBS takes an enormous hit

RBS, the second largest British bank behind HSBC, has finally come clean on the credit crisis. The price? An enormous $24 billion in new capital needed. This is a huge story because this does not even begin to discount the credit problems…

Finding a bottom

As the writedowns at global financial institutions near $300 billion in capital lost as a result of the sub-prime crisis, the question as to when we reach a bottom is ever more urgent. Market history tells us that the severity of the bust…

We need humility

Today, as I write this blog entry, the U.S. Economy is in crisis. We have a massive consumer and mortgage debt problem. Gasoline and food prices are going through the roof. The U.S. dollar is plunging. People are losing their jobs and…

Panic Time at the Fed

Steve Hanke, a libertarian economist who writes for Forbes, argues that the Fed is panicked about the economy in a piece that came out today. He believes they have lowered the Fed Funds interest rate to where inflation is now a problem.…

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