Happy St. Patrick's Day
Begorrah. You didn't know that my grandfather-in-law graduated in medicine, specializing in ob-gyn, from Trinity College Dublin. This gives me the right to wear the green.
It certainly beats worrying about the idiocy of U.S. protectionism making Mexican trucks move their cargo when crossing the U.S. border. This abomination was snuck into the Congressional pinada in violation of Nafta.
Tis true that by going to a Protestant medical school, my husband's granddad managed to avoid promising to always save and baptise the baby rather than the mother in a perilous childbirth, which I approve of, whatever various popes may say. Read more »
Living Up to Our Name
Oh shock! Oh horror! Money paid to AIG to cover the margin calls on credit default swaps wound up in the coffers of foreign banks (to say nothing of Goldman Sachs). Unlike the unseemly 2008 bonus payments to its CDS whiz kids or the Goldman connection with the former U.S. Treasury Secy., which are shocking, that U.S. money for AIG's ill-conceived 'insurance' products wound up abroad is not scandalous. It is normal business in the 21st century.
We don't live in a yellow submarine. We live in an integrated global economy with what used to ba functioning trans-national banking system. That is why the jingo tone of bank bailouts in the U.S. and other countries is so worrying. The money slops around; that's what money does. National borders are irrelevent. Read more »
The Ignobel Prize for Economics
The competition is heating up for the Ignobel Prize for Economics which is awarded every year by the Cuban Government. While the favorite for the 2009 award has long been 85-year-old Robert Mugabe of Zimbabwe, a younger sprinter is now in the running and coming up fast, thanks to nationalizing his country's transport system. Who will win the covered award for 2009, bookmakers are asking? Unlike regular Nobel Prizes, the economics award, which was only created a decade ago, take money away from the country of the winner. My bet is on Mugabe, who after all may not even be around as long as the Cuban government.
The other hot competition of the moment is the shape of the graph of the economy. Will our global recovery be U shaped, V shaped, or L shaped is the question of the moment? The bears, led by Nouriel Roubini, think the L has at least a 33.333 recurrent percentage chance of prevailing. That means a long slow slog at the bottom of the cycle. Roubini is a professor of economics at NYU here is New York and was one of the prescient forecasters of the current mess. Read more »
Nationalist Communist China
A series of Chinese actions over the last few days mark a resurgence of nationalism in Beijing. First there was the murky saga of the Yves Saint-Laurent auction at Christie's in Paris, over Manchu animal heads made in Europe for the Summer Palace, which are hardly Chinese treasures, and which the country could have bought before the auction for a lower price.
Then there was the standoff in international waters with a U.S. surveillance ship keeping an eye on Hainan Island. The U.S., which I trust in these matters, says China was violating international law.
And on Monday, there was a huge selloff in the final moments of trading in HSBC Bank, which is British, but also a part of the Hong Kong establishment: issuer of banknotes; key to the index; operator of the index (throgh its Hang Seng subsidiary); and investment touted by the city's Mir. Big, Li Ka-Sheng. Read more »
The Nifty Fifty Are Back
We're back to the early days when I first started investing and bought GE and ATT. Yesterday's upbeat market responded not just to Vikram Pandit's optimism on CI, but also to probable legislative changes to restore the uptick rule against short selling after a prior short sale. And a change in the rules of marking to market.
I am rather fed up with the Oracle of Omaha for talking down the U.S. economy, because I feel he wants to continue to do what he does so well, bottom-feed. Warren Buffett wants a buffet of high-yielding desperate companies he can gobble up cheap. But read on. Read more »
Making Money in This Market
It is not necessary to go to unheard of lands with exotic accounting standards, and different mores, to find bank shares which rise. Thanks to a seemingly upbeat report by Vikram Pandit today about Citicorp, of which he is CEO, every bank on earth has seen its stock rise. When I last looked, Barclays was up 21%. And in case you are not aware of it, the British banking group has a rather different regulatory and profit outlook than CI.
My reason for this remark is defensive. I do not want to buy a banking stock in Dubai, as Mark Hake, the errant analyst, and at least one reader think I should. I have trouble enough interpreting the accounts of banks in normal countries where the avoidance of 'ribah' (usury) does not lead to contortions. Given the perils of normal Western-style banking, I do not need to invest in its Islamic variant. Read more »
LIFO or FIFO?
LIFO and FIFO are accounting terms, for how inventories exiting are booked, first or last in, first out. But some analysts are using these terms to predict when the global economies will emerge from the downturn. The main optimistic view is that because the U.S. was first into the mess, it will be first out. FIFO in fact.
Since we never have been in a comparable economic downturn in my lifetime, I hesitate to make predictions. But I am sure of one thing: the stock market will not sink to zero. And the U.S. will come back.
In the interval, a good place to park your money (along with General Electric, which is up over 7.5% since I bought some last week) is Canada. The loony touched a new low for the 21st century today. GE was favored because this money was from an environmental stock position and GE is big on wind power along with everything else, although it is not part of my Global Investing universe of stocks. I think I invested in GE because it sounded ridiculously cheap for a company whose health is similar to that of the USA. Read more »
Today I am writing my blog directly on the Global Investing site for the first time. I am unable to find the font we use traditionally, courrier new, so this is something else. Traditionalists will have to forgive me. Also, for the first time in days, I am not having to run my copy past my lawyer before being allowed to post it. He is too busy filing a fraud complaint with the Attorney General of Florida and a Federal identity theft claim in New York.
I am also using the old HTML codes I thought were left behind in the 20th century, which this hotshot site requires. It was set up by some Russians whom, I fear, have not yet overcome the scorn for customer service that they were raised with. Markets are not what technical experts respond to anyway, and these guys also have a political bias against helping me out.Being a Friday child, I still have far to go, but I assure you I am doing my best. Read more »
Warning label: Rightside Advisors as of today, Thursday, are still continuing to solicit credit card payments for subscriptions and renewals for 47 newsletters, including Global Investing and Global Investing Pro.
Among the newsletters for which RSA is soliciting subscriptions is Dick Davis Digest, whose editor may not be aware of it. She has just asked to trade subscriptions with us. Read more »
I woke up in the night with a horrible thought: the reason Rightside did not deliver to my firm the subscription liability they had agreed to turn over was in order to fraudulently continue to use your credit cards to collect money for subscriptions to former Rightside publications. I have no evidence but given the cast of characters I described, it is possible. Please contact your credit card companies (or your bank if you have a standing bank order). If need be, change your account number.