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Frontrunning: October 18

Tyler Durden's picture




 
  • Federal Reserve urged to act on economy (FT)
  • Weil: Foreclosure Fiasco’s Trail Leads to Washington (Bloomberg)
  • Few Ready For Currency War (JAD)
  • ECB's Trichet Rejects Weber's Call to End Bond Purchase Program (Bloomberg)
  • Banks Face Mortgage Scrutiny as $49 Billion in Value Vanishes (Bloomberg)
  • Homeowners in Limbo - Mortgage Mess Means Delays for Those Facing Foreclosure (WSJ)
  • BOE Will Expand Stimulus by 100 Billion Pounds, CEBR Predicts (Bloomberg)
  • The Recklessness of Quantitative Easing (Hussman)
  • Why a Foreclosure Moratorium Is a Bad Idea (WSJ)
  • Fast Yuan Rise Will Be Short-Lived (Reuters)
  • Investors Bet Fed Action Will Bring Inflation (FT)
  • Hedge Funds Succumbing to Mutual Funds’ Mediocrity (Bloomberg)
  • Germany Bows to Call for Political Sway Over Euro Sanctions (Bloomberg)
  • Income Inequality: Too Big to Ignore (NYT)
  • U.K. Readies Cuts in Defense Outlays (WSJ)
  • Goldman Pushes Its Image Rehab (WSJ)
  • Benny & the debt - Bernanke could be replaying '70s tune (Post)
  • Tudor seeks shale gas deals (FT)
  • Facebook in Privacy Breach - Top-Ranked Applications Transmit Personal IDs, a Journal Investigation Finds (WSJ)
  • Obama seeks to rekindle enthusiasm of 2008 campaign (Reuters)
  • Data theft overtakes physical losses (FT)
  • Northeast Utilities to buy NSTAR for $9.5 billion (Reuters)
  • Investors eye FX wars and budget cuts (Reuters)
  • Business-Jet Rebound Delayed by Economy, Honeywell Says (Bloomberg)
  • Krugman Misleads On Government Spending, Economic Growth (Weekly Standard)
  • More sound and fury from Krugman - Rare and Foolish (NYT)

Economic data:

  • Japan Nationwide Dept. Sales -5.2% y/y. Previous -3.2% y/y.
  • Japan Tokyo Dept.Store Sales -3.8% y/y. Previous -3.4% y/y.
  • Italy Current Account (mlns euro) for August 5044M. Previous 535M.
  • UK Rightmove House Prices 3.1% m/m 2.9% y/y. Previous -1.1% m/m 2.6% y/y.
 

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Mon, 10/18/2010 - 08:30 | 657909 John McCloy
John McCloy's picture

Incredible who could have believed that CNBC would devote an entire hour to a impromptu pump directlyy from your friendly Fed Governor. 

Fisher's sole goal was to be on at 8am and talk about QE continuously. Ramp since 4am and no looking back. Regardless these banks better start hoarding that POMO and not putting it into the black hole soon to be the market.

Oh hey and Mr. Tarp Kashkari on as well. CNBC right in our face handing dollars to the architects of our wealth transfer. 

Mon, 10/18/2010 - 09:51 | 658034 assumptionblindness
assumptionblindness's picture

Did CNBC post the video clip from Kashkari this morning where he ADMITS that Hank had no interest in buying troubled assets but that he built 'flexibility' into the TARP request so they could re-capitalize the banks instead.  Kashkari said that Hank and other treasury officials knew that the Republicans wouldn't approve TARP if they knew that the banks would be handed hundreds of billions of dollars...duh!  Bait and switch indeed.

I wonder if anything that Kashkari said this morning contradicts his previous congressional testimony...

Mon, 10/18/2010 - 08:29 | 657910 TheGreatPonzi
TheGreatPonzi's picture

"Why a Foreclosure Moratorium Is a Bad Idea"

Given that the WSJ is a puppet for banks, this headline makes me laugh.

Mon, 10/18/2010 - 08:56 | 657939 cossack55
cossack55's picture

Now the Wall Street Jerk Off. (WSJO)

Mon, 10/18/2010 - 09:02 | 657948 Lux Fiat
Lux Fiat's picture

WSJ stance is often predictable.  But sometimes they get it right.

Interesting story on why the media and parts of the "left" wing don't get the Tea Party: http://online.wsj.com/article/SB10001424052748704631504575531913602803980.html?mod=WSJ_hp_mostpop_read

 

Those who doubt that the failings of higher education in America have political consequences need only reflect on the quality of progressive commentary on the tea party movement. Our universities have produced two generations of highly educated people who seem unable to recognize the spirited defense of fundamental American principles, even when it takes place for more than a year and a half right in front of their noses.

Mon, 10/18/2010 - 09:20 | 657978 packman
packman's picture

"Why a Foreclosure Moratorium Is a Bad Idea"

Given that the WSJ is a puppet for banks, this headline makes me laugh.

I'll restate what I have here a few times - IMO a foreclosure moratorium is a great thing for the banks, long-term.  I think that's partly why the big ones were so incredibly quick to adopt their own.

It accomplishes two objectives:

1.  Allows them to stem their losses at a self-chosen trickle.

2.  More importantly - it causes home prices to go up, by cutting of a large supply of homes for sale.  Less supply = higher prices.  Higher prices = less losses per foreclosure, and also more mortgage $$ even for unrelated non-foreclosure housing.

I think those that are presenting these foreclosure problems and the associated moratoriums as a bad thing for the banks are wrong.  It's bad for the housing market (driving prices up), but not bad for the banks.  Sure they'll have a lot of additional overhead costs dealing with the headaches, but it'll probably be more than offset by the things I mention above.

 

Mon, 10/18/2010 - 08:38 | 657922 snowball777
snowball777's picture

"The four banks control more than 55 percent of the market for billing and collections on U.S. home loans,..."

Ah yes, the inevitable outcome of monoculture: death by viral infection.

Bankers : natives :: MBS : smallpox.

 

 

 

Mon, 10/18/2010 - 09:21 | 657981 downwiththebanks
downwiththebanks's picture

No, more like:

Bankers : Europeans = MBS : smallpox

Mon, 10/18/2010 - 08:47 | 657929 Saxxon
Saxxon's picture

Remember, we can't do without the banks.  How would we borrow money?

Mon, 10/18/2010 - 08:53 | 657937 Sudden Debt
Sudden Debt's picture

DON'T DISPAER! THE LOANSHARK IS HERE!

I only charge a 99.9% interest a day. And as collateral, you can leave your daughters and your wife here.

Oh yeah, can you also give me your blood type? Just in case you can't pay back the loan and we'll have to sell some "assets" of yours.

Mon, 10/18/2010 - 09:20 | 657976 downwiththebanks
downwiththebanks's picture

Indeed:  without banks, who would steal our wealth to buy derivatives?

Mon, 10/18/2010 - 19:40 | 659824 LiquidBrick
LiquidBrick's picture

Remember, we can't do without the banks.  How would we borrow money?

Genius, why would you want to borrow money? That is just a perpetuation of banks and the continued detioration of the dollar is a guarantee that your life's wealth, production and savings will be eaten by those who produce nothing.

All the money in the world can't possibly make a bank achieve productivity. Lending money is the thinnest contribution to an economy. Government, Regulation and politicians bring more value to an economy/society.

The Free Market is already functioning without banks, trading on barter, networking and cutting overhead, taxes and deleveraging.  The Free Market can survive without banks. The banks can't survive without the markets.

Don't borrow, barter.

 

 

 

Mon, 10/18/2010 - 08:59 | 657942 Tic tock
Tic tock's picture

finally, a fashionable christmas.

Mon, 10/18/2010 - 09:44 | 658024 ZeroPoint
ZeroPoint's picture

And yet no mention of the robosigners facing felony charges for perjury. I guess that's because no one is being prosecuted, as usual.

If I were the judge, these people would be getting the maximum for contributing.

 

Mon, 10/18/2010 - 10:00 | 658050 kathy.chamberli...
kathy.chamberlin@gmail.com's picture

other professional were signing documents that weren't in order like title closers, mortgage brokers, appraisers and Realtors. it was collusion at it's finest.

Mon, 10/18/2010 - 10:10 | 658061 stoverny
stoverny's picture

The Hussman article on QE is fantastic. A must-read, and sadly 100 percent right.

Mon, 10/18/2010 - 10:35 | 658117 docj
docj's picture

I was totally with Hussman until he got to the paragraph starting with "Better policy options are available on the fiscal menu" - after which he ticked-off an entire laundry list of things that are neigh-on impossible, and impractical, to do when we're already running federal deficits on the order of 10% of GDP.

The only thing in that laundry list I agreed with was "multi-year stable tax policy".  The rest was just "stimulus" writ larg(er).

Mon, 10/18/2010 - 10:19 | 658081 docj
docj's picture

Federal Reserve urged to act on economy

Really?  You mean they've not done enough already?

Mon, 10/18/2010 - 10:30 | 658107 packman
packman's picture

Federal Reserve urged to act on economy

My analogy would be the rudder of a giant ship.  The Fed already did its work - it steered the ship into the rocks, the ship is rapidly taking on water.

The Fed is now being asked to fix things.  But rudders don't serve the function of bilge pumps.  All it can do is steer - but there's no point in trying to steer right now - the ship is just stuck and sinking.  All the rudder can do is just sit by and hope that the crew can fix the hole and the pumps can do their job to get rid of the water in the hull.

If and when that happens, and the ship can sail again - then we can revisit the rudder's function.  My suggestion would be to get a new one - this one has proven defective.

Mon, 10/18/2010 - 11:12 | 658226 Lux Fiat
Lux Fiat's picture

Nice analogy.  I am hoping that the holes get fixed, and that a new crew and rudder are found.

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cycjyf's picture

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daniel's picture

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