deleveraging

This September 2009 post still describes my general view on the U.S. economy. If I wrote it today, I would be more bearish medium-term because it is obvious that in 2010 fiscal and monetary policy will become less supportive of recovery.…

You have heard me use the phrase “liquidity is seeking return” to describe the increase in the price of riskier assets due to monetary stimulus. The Bloomberg News video clip below points to an increase in lending for buyers of riskier…

It has been my thesis for some time that we are seeing a secular change in consumption patterns in the United States.  This will have grave implications for a world economy used to seeing the American consumer as an economic growth engine…

This entry from Gary Shilling comes via John Mauldin’s site InvestorInsight.com where he highlights commentary from some of the best economic thinkers. Shilling, who correctly predicted problems in residential real estate in the US, is in…

PIMCO’s founder Bill Gross is out with his latest monthly missive.  It makes for interesting reading, especiallyregarding the captains of finance and their desire to stay rich using other people’s money. I remember as a child my…

Asset bubbles are strange animals. Ideally, you would like to punch the air out of them relatively early before they become a real danger but, in practice, it is not quite so simple. Ben Bernanke and Alan Greenspan have actually both argued…

Today, I want to make the case for seeing writedowns as central to this global downturn. To do so, we need to rewind and compare what is going on today with what we have experienced in the past. Drawing on this comparison, I can…

Citigroup is looking to raise capital and shed assets in order to deleverage and prevent a worst-case outcome for the financial institution. Case and point is the fact that the company is putting its Brazilian subsidiary Redecard on the…

Update: 18 Mar 2008. I am reposting this entry from Feb 10th because it is relevant to the need to liquidate insolvent institutions like AIG that are now getting bailouts.

David Rosenberg has been one of the voices of reason warning of excesses during the recent boom and predicting the unraveling to which we are now witness.  I have quoted him liberally here.  There is a very good piece on Rosenberg in the…