Diary of a Financier

Top Newsstuffs (May 28-June 3)

In Bookshelf on Sun 3 Jun 2012 at 05:23

Aaaand, scene.  My StockTwit on Friday said it all:

  • Today we crossed threshold fm Fear to Desperation on Cycle of Psychology. Cue emergency meetings & intervention rumors.
    Friday, June 1 2012


Rental Income to the Moon | Business Insider
Gross national rental income has gone parabolic to all-time highs >$450B (previous high in 2001 ~$230B).

Stop Believing What These ‘Experts’ Say About Greece | Bruce Krasting
The best thing to do is kick Greece out of Euro (EMU). “If all of Greece’s debt were wiped out, the cost would be $250B. By my calculation, the world has already paid a price 12x higher than that in just the past three weeks. If the game with Greece continues, the cost will be $10T and a global depression.”

Interview: John Browne (Euro Pacific Capital) | CNBC
“Epic struggle between the Anglo-American, Keynesian money-debasers and the German, sound-money Austrians.” Also says market’s a bear trap here, with us now first emerging from the original recession created by Greenspan’s excess and hidden by Bernanke’s QE.

Canada’s Housing Bubble | Sober Look
With only slightly better unemployment than US (7.4% v. 8.1%), Canada’s home prices still going parabolic. Construction jobs & household debt are booming more than in US 2006, even despite collapse in oil prices.

The ‘Greek Drachma’ Has Shown Up on Bloomberg Terminals | Business Insider
Bloomberg help desk says it’s “an internal function which is set up to test.”

SPX 2q2012 Earnings Preview: Deteriorating | Jim Bianco
2q12 y/y EPS growth was forecast for 11.12% in August 2011, now down to -0.20%. 3q from 4.0% to 2.8%; 4q from 15.5% to 14.9%.

The Great Reset: 2012-13 Will Usher in the End | Raoul Pal (Global Macro Investor/GLG Partners
The real problem isn’t so much the government debt as the $70T in G10 debt that’s the collateral for $700 trillion in derivatives (1200% of Global GDP). Expects systemic implosion.

Debunking The Offshoring Myth | McKinsey
China/labor outsourcing/offshoring are not to blame for loss of US jobs. This study analyzes the economy from 2000-10 and finds that productivity & a lack of domestic demand are the culprits.

Global PMIs (May 2012) | Business Insider
All nations seem to be reporting this week, and almost everyone’s Purchasing Managers Index is negative (i.e. manufacturing contraction).

Every Spring: Yeah, the Housing Bottom Is Here! (Not) | The Big Picture
Pundits have ignored seasonality of data and declared a housing bottom every year since 2006.

Worries Over Spain… SPexit? | Jim Bianco
6 reasons Spain will be the first to leave Euro.

European Commission Says It Is Willing To Envisage “Banking Union” | The Wall Street Journal
Direct ESM bank recapitalizations and cross-boarder bailouts. EU also says ECB has “limited scope for more stimulus.”

Spanish Bailout Would Cost €350 Billion | JP Morgan
€75B toward banks, the balance toward government funding needs. This would draw down more than half of ESM’s €500B cap.

Germany’s Proposal to European PIIGS: “Cash For Gold” | The Telegraph
Germany proposes to finance bonds for EMU members’ debt needs >60% Maastrict limit, but borrowers must pledge 20% collateral in Gold. [Noone will agree to this, it just collateralizes preexisting TARGET2 system for Germany’s welfare.]

Renewable Energy Has Far to Go Before Mainstream Acceptance | Citigroup
Chart compares all renewable energy sources apples-to-apples, using Levelized Costs of Energy (LCOE). Traditional hydrocarbons still much cheaper on $/kWh basis.

Buybacks Lowest Since 2009 as U.S. CEOs Push Up Spending | Bloomberg
58% decline (y/y) in buybacks with dividends steady, 38% capex increase. Companies repurchased ~$708B in 2010 & 2011, then announced a slip to $21.7B in April and $6.1B so far in May.

Greek Economic Makeover: 10 Year Growth Plan | McKinsey Consulting
Suggests Greece should start processing more of its raw food exports (olive oil, feta, yogurt) to capture higher margins.

Why The Euro Has Been Falling | Business Insider
Because ECB operates off only a “price stability” mandate, it’s sensitive reaction to oil prices has kept EURUSD tracking Brent Crude priceaction.


  1. […] an emergency life raft in case China implodes.” [Previously: The rise of Canadian subprime, Canada's real estate bubble & How Canadian regulation avoids crises] #Bearish […]

  2. […] Worst of all, housing bubble appears to be deflating. [Previously: The rise of Canadian subprime, Canada’s real estate bubble & How Canadian regulation avoids crises] $EWC $FXC $CAD #Mortgages […]


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