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Goldman's Jim O'Neill: "Let's Worry About Everything"

Tyler Durden's picture




 

Presenting some deeply philosophical observations from the man who has been wrong about pretty much everything, and to whom the jarring return of reality and its relentless destruction of the ivory towers he has carefully erected his entire career, can only be described as "surreal." No Jim - it's not surreal. It is all too real. The only surreal thing will be the response when GSAM's LP get their year end performance statement.

Let's Worry About Everything

From Goldman Sachs Asset Management Chairman, Jim O'Neill

On Friday in Paternoster Square outside our London offices, there was an Abba tribute band entertaining lunchtime workers in this gorgeous Summer sunshine we are enjoying. I ate my sandwich watching them. It was a beautiful distraction from the prevailing mood of the markets and the economic world. Of course, at the true Abba’s pomp in the late 1970’s, the world wasn’t in a particularly great shape either, so maybe there was something symbolic about it all.

Much of the latter end of the last week has felt rather surreal to me, as much of the economic data and comments from companies have been rather benign. And yet, markets continued to explore the grimmer angles. This was highlighted by the release of the much-better-than-expected Chicago ISM at 60.4, yet the US markets spent the afternoon weakening as the gloomy mood prevailed.

It wasn’t just the Chicago ISM that was better than expected. Despite the widespread view of the inevitability of a European and US recession, German data continues to be rather benign with another better-than-expected employment report, this time for September. Unemployment fell 26k, with the rate dropping to 6.9 pct. China has published a better- than-expected PMI for September, coming in at 51.2, Korean exports are holding up well, but in this mood, the markets will no doubt find some holes in these too. Perhaps Korea has started exporting to Jupiter?

It should have been a better week. Following the annual IMF meetings, there is some serious discussion of a “big bang” solution to the European problems. And, the German parliament passed the EFSF, somewhat easier than many had feared.

Judging by the price action, market participants seem to be increasingly convinced of imminent recessions in Europe and the US as well as a prolonged period of “Japanisation,” in which positive GDP growth struggles to keep ahead of a weaker underlying growth trend.

If this prospect weren’t grim enough, the notion of a “hard landing” in China is back on people’s minds with a number of participants promoting the idea, and many newspapers honing in on challenges in the property markets and financial sector.

What is the matter with everyone? Take a look at what happened in the 1980’s – after Abba played their last live concert in late 1982 – the world did rather better than expected.

FOREIGN BUYING OF JGB’S!

It all seems a bit surreal. Here is a story that highlights the weird state of everyone’s mind. “Foreigners flock to JGBs as Europe continues to flounder” ran the headline on page 6 of this week’s English version of the weekly Japanese Nikkei newspaper. According to the story, foreign holdings of JGBs have risen to 7.4 pct by the end of June 2011, up from 6 pct a year ago. More recent data suggests the trend will continue. Why are foreign investors doing this when all anyone talks about is the sovereign debt problem? On exactly comparable data, Japan’s debt-to-GDP ratio is two and half times worse than the Euro Area at around 220 pct of GDP.

I often appreciate the argument that JGBs won’t weaken because of the internal demand amongst high savers and due to the support from the BOJ. But, for foreign investors to add to their holdings strikes me as most peculiar. Neither the yield nor level of the Yen can be a sensible explanation, so it must simply boil down to some odd combination that a number of central bank reserve holders have too much spare cash, and they know that Japan is not part of EMU.

US DOLLAR BREAK OUT.

Sticking with the surreal, since the start of September, the Dollar has strengthened against many currencies. Indeed, it has managed to break above its 200 day moving average against virtually all cross rates that matter to the US, except for the RMB and – bizarrely – the Yen. I spent quite a bit of time over the past couple of days talking about why the Dollar is doing this with a number of analysts. Virtually all of them seem to think it is not that big a deal, and is purely attributable to “risk off” behavior and perhaps a repeat of the 2008-like scramble for Dollar liquidity.

I can’t see the case for sustained US$ strength against many “Growth Market” currencies. In fact, on the contrary, the $ should resume weakening against most of them through time. That said, I can see the case for a partial further $ recovery against the Europeans, perhaps the BRL, and some other liquid developed currencies. The Dollar has been significantly undervalued, the US external balance is slowly improving, the US is not as cyclically challenged as a number of others, especially Europe, and the forthcoming marginal policy developments in terms of monetary and fiscal policy, are perhaps not going to be US$ negative compared to others. On top of all of this are the major Swiss policy developments. And, as I wrote back at the time, “Swiss never lies”. It looks as though it isn’t lying this time either.
So, the Dollar needn’t be higher purely because of the “risk off” forces. Obviously, if this is the prime reason, it is not good, and hopefully won’t last for too long.

While many associate the Dollar move as another “bad” sign for the equity markets and confirmation of other darkening signals, there is no reliability about the consequences of the Dollar breaking above its 200 day moving averages, either as a precursor to sustained Dollar strength, or its consequences. More often than not as Neeti Bhalla from our ISG group pointed out to me, the S+P has been higher at specific 3-, 6- and 12-month internals following such breaks of the Dollar in the era of floating exchange rates. 2008 was a notable exception but there are many instances when the Dollar has appreciated for good , not bad reasons.

As for the future performance of the Dollar itself, time will tell, but if the US economy manages to keep on “ creeping” through despite all, perhaps this bounce has more to it than many suspect, at least for a while.

If sanity were to prevail, you might expect $/Yen to join the picture, but that is still far from clear despite the better close for the week.

UK ADJUSTED PLAN A?

To complete the political party season, the Conservative party starts its meeting this weekend in Manchester. I spent a breakfast with some of their faithful yesterday, and while they interpret the opposition’s stance on business and finance as good news for them, they all seem as worried about everything as many others. The big question in my mind is whether the Chancellor will give any hints of, if not a Plan B, a slight adjustment to Plan A? The case for such a move is pretty overwhelming, and sticking with the 1970’s theme, perhaps some regionally-geared infrastructure financing might not go amiss. There appears to be rising talk of the case for a Government Bank also, which is more like the 1950’s. I have to say that I find the argument quite compelling, and have for some time, having published a couple of pieces suggesting the idea back in 2008. After all, if you own the majority of some financial institutions and require more lending in the country’s national interest, then why not take all 100 pct and go for it?

PUTIN’S BACK.

I could have devoted the Viewpoint to this topic and I shall return to it in coming weeks. If it hadn’t been so conceivable, this development could easily sit in the surreal bucket also. I expect an increase in the intensity of emails I receive suggesting the removal of the R from BRIC. I know many close to Medvedev are most disappointed, and this for me is disappointing, but as one wag wrote, while they thought they were working for the other side, the other side was working for the other side...quite remarkable. For those of us who do not live in Russia, I do think we all need to remember that Russia likes its strong leaders, and if this transition is peaceful and things remain stable, that will be more than a decade of stability, which for Russia, is quite an achievement.

THE EURO MESS.

As I said at the start, this should have been a “better” week with the noises emanating from DC and Germany passing the expanded EFSF package. I guess one can only conclude that things have moved on so much, that the market’s reaction this week is that the “big bang” ideas are necessary because we are heading for the worst in Greece. This week, we will publish our Monthly Insights and it will be devoted to the issues of EMU and reflect back on much of the discussions we have had about the problems, including a special section from Jonathon Bayliss, who heads up the European Government investing team and has been so on top of all the issues.

The bottom line for me is this: the November G20 is likely to be a major point of inflection, which will either resurrect life or leave us in deep hibernation through the Winter. We need to have by then a credible path for Greece, elements of the big bang in terms of bank recapitalization, and collective buy-in from all of Europe’s key players. Not much to ask for...

CHINA. THE REAL THING OR A HARD LANDING?

Monday’s FT carried the following headline on the front of its second section, “China the real thing for business rather than the US, says Coke chief”. Expanding on the fact that China now accounts for 7 pct of Coke’s global business and the first half of 2011 saw them double their sales from 5 years ago, the CEO elaborated about how welcoming many regions of China were to them, and contrasted it with the deteriorating picture in the US.

I picked up this same theme at an Economists’ conference on Growth Markets that I had the pleasure of being the closing speaker at on Friday. But back in the surreal world of markets, my inbox was full of really gloomy stuff about hard landings, property collapses, major NPLs and so on. As I said earlier, “what is the matter with everyone?”

It is pretty obvious that you will have some failed property lenders, where a country’s policymakers deliberately choose to stop a strong rise in property prices before it gets out of hand like the US and Europe, as the Chinese have done in the past 2 years. I can’t understand why it therefore translates into a “hard landing”. The Chinese property market has some issues because of deliberate policy. In fact, it is remarkably impressive, and a huge contrast to virtually any evidence I can see from my days in the markets, that a policymaker would choose to prick a property bubble before it gets to the stage that we all know only too well.

China, as I have written about now for nearly a year, has entered a new phase of development where the quality of growth matters more than the pure quantity, and with it, the sustainability of growth. This would suggest that the next 5 years would see an outcome closer to the 7.5 pct average, which the 5 year plan assumes. As a critical part of it, the Chinese consumer is going to be more important, which is why, for me, the Coke CEO’s comments are more pertinent than all the nonsense flying around the fast money crowd this week. In the coming weeks, the key in all this will be Chinese inflation, and judging from the chart of agriculture prices that GS’s Yu Song sent me Friday, it is coming down. Once that happens, talk of a hard landing will dissipate.

Enjoy the sunshine if you are lucky enough to have what we have in the UK this weekend.

 

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Sat, 10/01/2011 - 20:46 | 1729901 knukles
knukles's picture

What the Fuck is Wrong With You?

Sat, 10/01/2011 - 20:51 | 1729912 I am Jobe
I am Jobe's picture

Forgot his meds.

Sat, 10/01/2011 - 21:08 | 1729936 Earl of Chiswick
Earl of Chiswick's picture

meanwhile

hundreds arrested tonight by Mayor Mike Boomberg's finest

http://www.nypost.com/p/news/local/brooklyn/wall_st_protestors_shut_down...

 

Sat, 10/01/2011 - 21:34 | 1729967 Spastica Rex
Spastica Rex's picture

I heard that some of the ZH readership are planning on disrupting the NYC protests using camels and riding crops.

Sat, 10/01/2011 - 23:07 | 1730098 Bicycle Repairman
Bicycle Repairman's picture

I didn't like ABBA in the 70s and I sure as hell do not like them now.

Sun, 10/02/2011 - 03:03 | 1730330 Fukushima Sam
Fukushima Sam's picture

Jim, WTF?

Not only does ABBA suck, but you forgot about Fukushima in your little "analysis" of "the Japanese situation".

Read this, first person point of view from an American living in Japan for many years:

"We in Otsu-City, Shiga Prefecture, 311 miles (500 km) from Fukushima, are seeing readings around 0.15 microsieverts on average, which is around five times what the Japanese government is reporting. My wife and children will leave Japan as early as possible because I perceive a growing exodus will come and it might become hard to place kids in schools."

http://www.earthfiles.com/news.php?ID=1897&category=Environment

Sun, 10/02/2011 - 09:36 | 1730570 Popo
Popo's picture

An extremely large part of Japan (including Tokyo), has for all intents and purpsoses -- been destroyed.  That is not an overstatement when one considers that the irradiated areas will remain radioactive for the next several centuries -- and the irradiated areas extend hundreds (if not thousands) of kilometers in all directions.   Just because the television isn't showing us scenes of mass exodus with the population fleeing overnight -- does not make the destruction of the capitol any less real.

The damage has already been done to the nation -- and with every day that passes -- it is being done far more brutally and insidiously, to the Japanese citizenry.  As this catastrophic human damage begins to manifest itself -- and it is profoundly sad to say that it will and must -- the existential truth about Japan's very survival will become clear.

That is most assuredly, not "priced in" to markets.  

Jim lives in an ivory tower, dining on government-sanctioned data and bank-massaged balance sheets.   And no doubt,  he's paying close attention to those "official" Japanese government radiation reports which tell us that everything in Nippon is "normal".  

Poor Jim.  He failed to predict any of the recent collapses -- and continues to ask cluelessly, where all the "gloom" is coming from as he eats his sandwich in the park.   That Category 6 shit-storm heading towards you is going to be such an awful surprise for you, Jim.   You'll probably wonder where on Earth it came from -- if you even notice it with Abba playing, and all...

 

 

 

Sun, 10/02/2011 - 11:18 | 1730743 knukles
knukles's picture

Absolute Clarity.
I salute you.

Sun, 10/02/2011 - 15:13 | 1731164 zorba THE GREEK
zorba THE GREEK's picture

I believe that people can withstand much higher radiation levels than is now believed.

Where are the reports of people getting radiation sickness in Japan. Even in Gernoble (misspelled)

there have been far fewer deaths from radiation than expected. A lot of the radiation fears are

overblown. I wouldn't be surprised if Fossil Fuel Backers have something to do with spreading fears

in order to turn people against nuclear reactors. I'm not saying that prolonged exposure to high

radiation doesn't do any harm. It is clear that it causes birth defects and weakens the immune

system, but what I am saying is that people can withstand brief exposure to high radiation and

prolonged exposure to mild radiation without being harmed. If this were not so, those men who

have been working around the power plant in Japan would be dropping like flies now and that is

not the case. Twentysome years ago, there was a guy who for decades went around and publicly

drank highly radioactive water from nuclear power plants and exposed himself to extremely high

amounts of radiation with no visible signs of harm. I am not saying that any level of radiation is

safe or that prolonged exposure to moderate amounts won't cause cancer in 20 years or so.

What I am saying is that there is much evidence that people may have a much higher threshold

to radiation exposure than is commonly believed. 

Sun, 10/02/2011 - 09:54 | 1730616 Vlad Tepid
Vlad Tepid's picture

Thanks for the post. I'm going to follow your posts posts in the future as Otsu is the cradle of my personal civilization.

Forgive me though if I mistake his concern for a bias, as he also apparently believes that the Prius car is going to give drivers cancer.

http://www.japantoday.com/member/view/Frank-E-Daulton

I have been deeply disturbed by the fact that Fukushima and "affected area" produce has been showing up gleefully on the shelves as potentially tainted beef is stripped off the shelves with a lot of pomp.  The quoted source is much mistaken if he believes that Japanese people are not discussing this (they are), and he also appears to misinterpret the cultural phenomenon of "gaman" and "shikatta ga nai" for a collective avoidance syndrome.

I did not have any device for measuring radiation this summer but I will be using one to check the very area discussed above at the end of the year and in June.

Sun, 10/02/2011 - 10:06 | 1730634 Gadfly
Gadfly's picture

Clueless.

Sun, 10/02/2011 - 23:45 | 1732221 rocker
rocker's picture

Remember the Goldman manta, "Someone has to take the opposite side of the trade. 

Sat, 10/01/2011 - 21:36 | 1729972 knukles
knukles's picture

Ya know, this thing could very very easily get way the hell out of control.  Too many people of too many different backgrounds all there protesting for something which they all very seriously believe in but probably cannot elucidate amongst themselves well but understand amongst themselves quite intimately...
And only takes one bad ass screw up or agent provocateur (hint hint) to ignite the tender ...and BANG!...  it'll be off and running.

This is another demonstration (no pun intended) identical to all of the others surfacing about the globe regardless of the powers or ideologies inspiring such....
Simple Disenfranchisement.
And it's growing. 
In an electronic age, spreading at the speed of light so to speak.
The frequency of these displays of restlessness, irritability and discontentment are increasing as are the magnitude and amplitude if you will.  They're becoming bigger and bigger, each within the context of it's very own cultural, social, economic and political habitat.

And is it all truly circumstantial that in most cases there is an accompaniment such as in this one by the Mayor warning of popular troubles just days prior?  I am not suggesting in any way shape or form that there is even any conspiracy theory warranted.  It is just odd...  Like military drills coinciding with accidents....

I'm getting a funny feeling that something's happening. I can't put my finger on it.  I cannot describe it.  I cannot find the appropriate terms, so disenfranchisement will simply have to do for the moment.  And it will spread... that I got a funny, strange feeling about.

Sat, 10/01/2011 - 21:41 | 1729979 Spastica Rex
Spastica Rex's picture

The con isn't holding everybody's attention like it always has. The grifters might have to change their tactics to engender fear, if the marks don't play the game like they're supposed to.

Sat, 10/01/2011 - 23:15 | 1730105 Comay Mierda
Comay Mierda's picture

There will be plenty of agent provocateurs causing violence on the streets, the real protesters are peaceful and know that violence plays into the police state agenda

Sat, 10/01/2011 - 22:25 | 1730042 kaiserhoff
kaiserhoff's picture

Zeitgeist - It's untranslatable, but you did pretty well.

Sat, 10/01/2011 - 22:35 | 1730061 Piranhanoia
Piranhanoia's picture

I remember a story about a group of men and boys that said goodbye to their families one morning to protect a route that they thought the British might take to harm their neighbors and themselves.  They stopped at the bridge.  The boys dressed in red fired upon those guys at Concord bridge.  Another chapter is about to be written.

Sat, 10/01/2011 - 23:09 | 1730093 Dick Fitz
Dick Fitz's picture

Piranhanoia-

That is the best name EVER!

I agree- there is an inchoate, undefined, and ineffable...feeling. Fear. Paranoia. Uncertainties with myriad names.

I was at a large wedding tonight, and talked to a variety of people, and whenever "the state of the world" came up (and I made sure to bring it up!) their responses were VERY different from a year ago. Everyone had some sense that things were "wrong", but no words to describe it.

This was a diverse group of 20-50 somethings, and when I brought up Ron Paul more than half knew who he was, and at least a quarter were ready to hear me talk about his plans. That's a BIG change from 4 years ago.

The US is ready for a radical, even if he's old, "crazy" and "unelectable" in the eyes of the MSM.

Sun, 10/02/2011 - 01:08 | 1730240 data_monkey
data_monkey's picture

Many sheeple will lose their minds in their own households before they even make it to the streets.

Sun, 10/02/2011 - 01:04 | 1730208 scatterbrains
scatterbrains's picture

If these kids want to see shit get real there going to have to provoke an escalation of the "use of force" they have in their numbers the ability to fight batons with batons, mace with Greek style cocktails and when the 1st protestor gets gunned down shit goes national!... just saying.. I'm sure no one wants to see shit escalate but the cops don't have the upper hand here..the commish is shitting his pants hoping it don't escalate.

These "kids" dont forget, have been raised on Ultimate fighting and Call of Duty etc.  so yea, I'd say it's a tinder box out there.

Sun, 10/02/2011 - 11:06 | 1730730 Are you kidding
Are you kidding's picture

Nope...it's too early.  People aren't ready yet...not desperate enough. 

Sat, 10/01/2011 - 23:18 | 1730100 Comay Mierda
Comay Mierda's picture

How does goldman rule the world when they are full of retards?

Sun, 10/02/2011 - 00:25 | 1730199 mahalopamala
mahalopamala's picture

Oh no he didn't. Yes, he went full retard. (movie with jack black, ben stiller, and robert downey jr) hee hee- Comay thanks for the laugh in this grim time.

 

 

Sun, 10/02/2011 - 01:11 | 1730242 LowProfile
LowProfile's picture

Lies and graft.

Sun, 10/02/2011 - 09:51 | 1730610 daily bread
daily bread's picture

They bought Con-gress and the Adminstration.  Is it that hard to see?

Also, I wonder how many on the Supreme Court got law school scholarships funded by the squid.

Sun, 10/02/2011 - 10:21 | 1730660 citrine
citrine's picture

daily bread,

you reminded me of the article by Michael Lewis "Bashing Goldman Sachs is simply game for fools", and in particular the following part:

Rumor No. 1: “Goldman Sachs controls the U.S. government.”Every time we hear the phrase “the United States of Goldman Sachs” we shake our heads in wonder. Every ninth-grader knows that the U.S. government consists of three branches. Goldman owns just one of these outright; the second we simply rent, and the third we have no interest in at all. (Note there isn’t a single former Goldman employee on the Supreme Court.). What small interest we maintain in the U.S. government is, we feel, in the public interest. Our current financial crisis has its roots in a single easily identifiable source: the envy others felt toward Goldman Sachs.

Mon, 10/03/2011 - 00:23 | 1732277 combatsnoopy
combatsnoopy's picture

The NYPD are Wall Street's mercenaries.  Dimon bought them off for $4.6 million. Little did the NYPD think that Dimon only got that money from the taxpayers.  And that the taxpayers were robbed to salvage their pensions when Wall Street LOST it by selling uncollateralized "collateralized" debt obligations.

Thugs are thugs because they're not the sharpest tools in the shed.  It's unfortunate that "democracy" gives that much power to dummies.  But then again, look at what our lobbyists did to this country.  

Note to the NYPD, DON'T BITE THE HAND THAT FEEDS YOU.  

Sat, 10/01/2011 - 21:09 | 1729937 DeadFred
DeadFred's picture

Wow! Talk about rose colored glasses, I gotta score me some of those for when things look really down.

Sun, 10/02/2011 - 01:39 | 1730260 mfoste1
mfoste1's picture

im pretty sure he was drunk/high when he wrote this

Sat, 10/01/2011 - 21:34 | 1729969 Taint Boil
Taint Boil's picture

Let it go ... everyone has a say here.

Freedom ..... great country and a great blog. Water always finds it's own level.

Rum and Coke kicking in on this end probably the same on that end .....

Sat, 10/01/2011 - 23:15 | 1730106 Dick Fitz
Dick Fitz's picture

1- I hope they lock you up in Guantanamo for that name. EVIL! Boils hurt, and I can't imagine one...there.

2- free country? Well, unless they disagree with you, then they kill you, no trial, no jury, just BOOM to the head.

3- Rum? Vodka is much better!

Sun, 10/02/2011 - 10:20 | 1730659 Don Birnam
Don Birnam's picture

Lord Jim.

Sat, 10/01/2011 - 20:56 | 1729916 gangland
gangland's picture

fubar i hate posting links so here's mine

http://falsepolitics.wordpress.com/2011/ excerpts from suskind's  new book till i get sued

Sat, 10/01/2011 - 21:39 | 1729976 Taint Boil
Taint Boil's picture

Ok here is mine too.

Patrick.net Real estate links, Rent vs Buy, etc, A good guy and NO ads ..100% legit

Sat, 10/01/2011 - 20:56 | 1729917 Arius
Arius's picture

w/ all due respect to GS not sure this guy has his priorities quite right ... russia before china in his list of priorities ???  thats the old rule ... perhaps he could try to project whats coming not talking about what already happened .... china is the new world like it or not ...

Sat, 10/01/2011 - 20:59 | 1729921 knukles
knukles's picture

Not only the hierarchical ranking, but expressing anything other than a recognition of business as normal with the Return of RasPutin is just so fucking naive.

Sat, 10/01/2011 - 20:56 | 1729918 Absalon
Absalon's picture

Dear Mr. O'Neill:  You don't understand why people are negative?  I'm negative about the markets because I think the financial statements of all the major banks in the United States, Europe and China are works of fiction.

Sat, 10/01/2011 - 21:13 | 1729943 DeadFred
DeadFred's picture

Why weren't we elated with the Chicago numbers? because we didn't believe them. You only get to lie so many times and then your cred is gone.

Sat, 10/01/2011 - 21:32 | 1729965 mendigo
mendigo's picture

He ate lunch while listening to ABBA!
Speaks volumes.

Sat, 10/01/2011 - 21:38 | 1729974 knukles
knukles's picture

Wow.... time dilation

Sat, 10/01/2011 - 22:45 | 1730068 Piranhanoia
Piranhanoia's picture

Well, he said it was an Abba cover band, so maybe he saw two guys and two girls.  Knowing that he thought this was lunchtime, and the guy is chemically challenged based on what he writes on happy talk...  He might have been seeing double and watching a Sonny and Cher cover band?  What the hell would he know?   It was probably the Salvation Army lady and her trombone player and he was working his 4th vodka and glass. 

Sat, 10/01/2011 - 21:57 | 1730002 max2205
max2205's picture

He must be gay and btw we only go up on real bad news. Sorry Jim.

Oh and go fuck yourself GS!!

Sat, 10/01/2011 - 20:59 | 1729920 Pretorian
Pretorian's picture

It is astonishing how fast this man forgot save haven position on CHF trade.  Now since CHF is draining  slowly, unfed from the Goldman UBS blood ... now it can provide some energy to heavenly damaged sovereign countries at least until Jim comes back with more poetry. Fuck off bitch go to your bankrupt nation which funeral have been arranged by you and you partners at Goldman so you can sleep well at night.

Sat, 10/01/2011 - 22:50 | 1729929 tom a taxpayer
tom a taxpayer's picture

 

O'Neill is lost in Deep Thoughts.

http://www.youtube.com/watch?v=KSrXpFb7jFo

Hey, O'Neill, why don't you and your sandwich take a lunchtime stroll up to Tottenham, North London and cogitate on the "surreal" riots and arson of August. Maybe do a little pro bono work for the less fortunate lads and lower class criminals.

Sat, 10/01/2011 - 21:05 | 1729930 buzzsaw99
buzzsaw99's picture

the only thing surreal for jim is why his bonus is in gs stock and not cash.

Sat, 10/01/2011 - 21:11 | 1729941 CrashisOptimistic
CrashisOptimistic's picture

He doesn't understand oil geology and as long as that remains true, he'll be delusional.

Sat, 10/01/2011 - 22:05 | 1729961 tom a taxpayer
tom a taxpayer's picture

 

Yep, and it's O'Neill's fault. Everything he says is a lode of schist. He should have paid attention to his Auntie Klein. He's a dip with no core values.

 

Sat, 10/01/2011 - 21:14 | 1729944 tawdzilla
tawdzilla's picture

time to play...let's follow the logic:

ABBA played music in the 70's, when the stock market was down

The stock market recovered in the 80's after ABBA stopped playing.

The ABBA tribute band is playing music in the 10's when the stock market is down,

Therefore...the market will recover after the ABBA tribute band stops playing?????

Sat, 10/01/2011 - 21:22 | 1729946 DormRoom
DormRoom's picture

First, unemployment is not a leading indicator, if an economy is heading into recession.  So why  put so much emphasis.

 

Second, 1982 was the start of the debt bubble, culminating in the S&L crisis, which created the moral hazard, that generated our 30 year debt bubble.

Thirdly, JGB buying is likely from yen carry trade unwind.  //sign hedgefunds are deleveraging.

Fourth, USD surge likely due to USD carry trade unwind.  //sign hedgefunds are deleveraging.

Fifth, Putin would like to see the end of the EU; NATO for that matter. No help from Russia.

Sixth, Germany passed the EFSF, but it can go no further.   probability of Germany leaving EZ.  Why else would all the high ranking Germans leave the ECB.  They may help plan the German exit.  Thus no conflict of interest.

Lastly, EZ goes down, China goes down harder, since most of Chinese exports go to the EU.  Chinese cannot offest lost exports with domestic demand in time.  Huge cultural friction to domestic consumption. poor social services, which incentivizes people to save.  Asymmetry at play.  Export demand collapse faster than Domestic consumption gains.  Its economy is already overheated.  More stimulus risk pushing it into runaway inflation, and more bad loans. Hard landing vs. hyperinflation.

Sat, 10/01/2011 - 21:20 | 1729947 Cursive
Cursive's picture

there was an Abba tribute band entertaining lunchtime workers in this gorgeous Summer sunshine we are enjoying.

Markets being rational reacting to sovereigns on the very of default?  Not surreal.  Abba tribute band? Very surreal.  Jim O'Neil lives in the La La Land of textbook economics.  Jim, get your head out of Paul Krugman's ass.  You might realize that Fall has begun and Summer is in the rear view mirror.

Sat, 10/01/2011 - 22:06 | 1730013 Schmuck Raker
Schmuck Raker's picture

I stopped reading when i got to that bit.

Sat, 10/01/2011 - 21:29 | 1729959 FreedomGuy
FreedomGuy's picture

What is the common denominator of all these musings? We live in a time where all economies are tied inexorably to political decisions. Central bank coordination, currency manipulations, government stimuli, massaged economic data...all based on the number one religion worldwide amongst the political class, Keynesianism. Each round of stimuli and currency manipulations is supposed to do it's economic magic, but it never does. There is not one asset class safe from government interventions of some sort. Forget yields, P/E's, commodity demand, look only to the next idea of the central planners. Surely they will turn lead into gold. Maybe they can even turn fiat paper into gold!

The answer is the one that not one single nation of any consequence on the face of the earth will do: leave things-business- entrepreneurs- freedom alone. Focus on what governments should do, namely, live within means, provide sound currencies, protect property and people.

Sat, 10/01/2011 - 21:48 | 1729990 zen0
zen0's picture

And prosecute, rather than encourage, fraud.

Sun, 10/02/2011 - 19:50 | 1731757 FreedomGuy
FreedomGuy's picture

Agreed. Part of leaving things alone is letting banks and financial houses that made bad decisions fail, as well. This idea that the State protects us from " bad" guys is ridiculous. They encourage and protect them, hence your comments. I would add that they create them, too.

Sat, 10/01/2011 - 21:39 | 1729975 Unprepared
Unprepared's picture

I couldn't read past the first 2 paragraphs. For those who had the courage, is it safe to assume that Mr. Asset Massaging chairman's conclusion is that GS is surreally fcuked?

Sat, 10/01/2011 - 22:06 | 1730011 Earl of Chiswick
Earl of Chiswick's picture

OT

http://twitter.com/#!/AdelHrecinova

The first three words you find will describe you
http://p.twimg.com/Aasn9lUCEAIFO9m.png

Sat, 10/01/2011 - 22:17 | 1730031 Everyman
Everyman's picture

My three are "Fat, Funny, and Love"

I am not fat, and I am funny, but I am unloved?

Sat, 10/01/2011 - 22:40 | 1730064 slewie the pi-rat
slewie the pi-rat's picture

yes!

unconditionally, too!

Sun, 10/02/2011 - 00:23 | 1730195 MsCreant
MsCreant's picture

Jim o'Neill tweeted his:

Fat, broke, fool

Sun, 10/02/2011 - 00:11 | 1730180 Dapper Dan
Dapper Dan's picture

Thanks earl,

 

broke

but

fun

Test works well.

Sun, 10/02/2011 - 00:24 | 1730198 MsCreant
MsCreant's picture

Pretty, bad, fool

but I found whore pretty quick too.

Sun, 10/02/2011 - 00:56 | 1730218 Unprepared
Unprepared's picture

While channeling Jim O'Neill spirit*: Broken Whore Beatiful

 

*I lost some some IQ-points in the process and had an irresistible urge to torture a cat.

Sun, 10/02/2011 - 00:59 | 1730231 X.inf.capt
X.inf.capt's picture

pretty, lovely, beautiful

hmmm......

found whore, too...nothing wrong with that....

Sat, 10/01/2011 - 22:08 | 1730017 David99
David99's picture

My feeling is that FED has launched OT with a purpose similar to QE programmes but with a different name. The ultimate objective of FED would be to jack up the Casinos.
Your comments on OT, whether the markets will go up or down are invited please.

Thanks

David

Sat, 10/01/2011 - 22:17 | 1730029 holdbuysell
holdbuysell's picture

"It should have been a better week."

Shoulda, coulda, woulda.

This guy's a professional in finance??!!

Sheesh.

 

Sat, 10/01/2011 - 22:23 | 1730040 holdbuysell
holdbuysell's picture

Huh. He seems tired, almost capitulating that it's over for the EU.

Sat, 10/01/2011 - 22:27 | 1730047 TN Jed
TN Jed's picture

Money, money, money
Always sunny
In the rich man's world

Sat, 10/01/2011 - 22:28 | 1730050 FinalCollapse
FinalCollapse's picture

O'Neill - get ready for 'Smoke on the Water' you pussyhead.

Sat, 10/01/2011 - 22:29 | 1730052 slewie the pi-rat
slewie the pi-rat's picture

“what is the matter with everyone?” asks jim o'neill

well, they all bet on the wrong shit, maybe?  nostalgia for the alpha global hedge fund?  people tired of hearing economic propaganda?  lies not working?  too much uncertainty?  too difficult to get cash?  too many lawsuits?

low confidence?

jeeeeezZ!  me too.  PMs getting drop-kicked as the chairsatan re-commits to zirp and pretends (?) to stop the presses, as the econom swoons and passes out...

how're those tents coming along for fuk_u_shima? 

 

Sat, 10/01/2011 - 22:30 | 1730054 Hedgetard55
Hedgetard55's picture

What planet is Jim from?

Sat, 10/01/2011 - 22:42 | 1730065 slewie the pi-rat
slewie the pi-rat's picture

uber-dooby

Sat, 10/01/2011 - 22:52 | 1730076 dust to dust
dust to dust's picture

 Surreal? No it is REAL. Happening NOW in REAL time. The squeeze is  getting tighter. Gonna have to deal with it, Jim. Ouch!

Sat, 10/01/2011 - 22:53 | 1730077 JupiterAndBeyond
JupiterAndBeyond's picture

[sarcasm on]

With the volatility in the precious metals, I have a strong feeling that the US dollar has a bright future.

[sarcasm off]

Sat, 10/01/2011 - 23:16 | 1730108 gimli
gimli's picture

After reading this article I've decided to downgrade ABBA to BBBB

 

Sun, 10/02/2011 - 00:17 | 1730186 lunaticfringe
lunaticfringe's picture

That would be an upgrade. Fify.

Sat, 10/01/2011 - 23:25 | 1730122 RobotTrader
RobotTrader's picture

What he forgot to mention is that Trichet and Wen Jaibo both triggered this economic collapse with their rate hikes to "battle inflation".

 

Well, they got what they wanted, the CRB Index is now getting crushed along with stocks.

Sun, 10/02/2011 - 00:02 | 1730173 slewie the pi-rat
slewie the pi-rat's picture

the dollar is going straight up, RT!

commodities are deflating, but it is only transitory, like the price increases on the way up

L0L!!!

 

 

Sun, 10/02/2011 - 00:44 | 1730222 X.inf.capt
X.inf.capt's picture

crb index getting crushed..

good news for most ZH'ers and myself....

another BTFD opportunity, buy and hold, that is..

Sun, 10/02/2011 - 09:53 | 1730614 X.inf.capt
X.inf.capt's picture

how could i get junked for wanting phyiscal silver....

'HELP, IM BEING OPPRESSED'

-montey python

Sun, 10/02/2011 - 10:06 | 1730635 Vlad Tepid
Vlad Tepid's picture

Repressed...and two helps.  I have it memorized.

Sun, 10/02/2011 - 10:19 | 1730655 Pool Shark
Pool Shark's picture

 

 

Bloody peasant.

(p.s., there's no 'e' in montey...)

Sun, 10/02/2011 - 11:24 | 1730754 X.inf.capt
X.inf.capt's picture

green to above...

you guys are great!

Sat, 10/01/2011 - 23:31 | 1730130 Georgesblog
Georgesblog's picture

The smell of burnt out brakes and the sound of twisting metal that is the train wreck Federal Reserve is very real, once the senses come back to reality. The debt is piling in behind the engine that pulled the Ponzi scheme for 99 years. I guess we can call this "The wreck of ol' No. 99"

http://georgesblogforum.wordpress.com/2011/06/26/sink-swim-or-learn-to-d...

Sat, 10/01/2011 - 23:43 | 1730147 reader2010
reader2010's picture

Bullshit, bullshit and purely bullshit.

As for China, here's one of eyeopeners, or the NYT Page 16 story if you will.

http://www.atimes.com/atimes/China_Business/MJ01Cb02.html

 

 

 

Sat, 10/01/2011 - 23:46 | 1730152 kito
kito's picture

i long for the day that the only possible way we can hear the shit spewing from goldman sachs will be from the archives................

Sat, 10/01/2011 - 23:56 | 1730163 bill1102inf
bill1102inf's picture

Farmers make more $$$ today than at any time in history, ANYWHERE in the entire world.
Thanks to inflation prices paid for grown veggies and fruit are higher today than ever.  Yet most farms were bought 50-150 years ago. When the farms were literally dirt cheap (by todays standards).  Example, if you bought a $100,000 farm in 1950, that produced $100,000 a year in sales, today, it would be a farm worth $2,000,000 that sells $2,000,000 a year for the SAME AMOUNT OF PRODUCTION.  Sure gasoline is more expensive and so is electricity, labor and equipment. But, WHO CARES when there is no mortgage and your making millions of dollars? Example - price per lb of cotton - 1940 - 10 CENTS ...... 2011 March price 229 CENTS Many farms are family owned and have been owned since the 1800's!!!!! If their is a mortgage on a farm its only a business decision not a neccesity.  The same amount of cotton sells for literally THOUSANDS of % more than it did just 50 years ago and forget about since the 1800's. Boomers and the people before them ENJOYED INFLATION, it LITERALLY MADE THEM RICH.  Because of INFLATION there is no way for new people to get involved in production. Do you understand not only how the rich got rich but also how it is impossible to do so now?  It was NOT hard work, it was simply time. For this to work today, for you to ENJOY INFLATION like our elders have, in 20 years houses will have to appreciate 20X, that means a $100,000 house will be $2,000,000 , min wage will be $140.00 per hour, gasoline $60.00 a gallon. Since that IS NOT GOING TO HAPPEN, you do_realize_you_are_screwed right?

Sun, 10/02/2011 - 00:16 | 1730185 reader2010
reader2010's picture

The early nominal values you quoted are merely mythical or illusionary based on fiat. If you have priced them in gold, nothing has really gone up at all. 

Sun, 10/02/2011 - 03:51 | 1730304 Smithovsky
Smithovsky's picture

I don't think you understand the concept of inflation, bill.

The 1950 farm-buyer isn't 20 times more rich because everything else now costs 10 times more than it did in 1950.  $2M now buys the same amount of stuff that $200K did in 1950.  The farmer in your example has simply doubled his money.

Farmers are heavily subsidized all over the world, it's not as profitable a business as you think it is.  

Sun, 10/02/2011 - 09:17 | 1730571 Diogenes
Diogenes's picture

What do you mean not going to happen? It is happening right now. Inflation is a very real economic factor even though the mainstream media is not talking about it yet.

How can the world not have inflation with every country running the money pumps in overdrive? So far it is a standoff between inflation and deflation but inflation is getting the upper hand.

In a 10 or 20 years a pack of cigs or a gallon of gas will be $200 and a house will be $20,000,000. Interest rates will be 10% to 20% and anyone who bought a few houses at today's depressed prices and low interest rates will be very happy.

Sun, 10/02/2011 - 19:44 | 1731742 Georgesblog
Georgesblog's picture

Obviously, you've never worked on a farm. Middle men get the lion's share of retail food prices.  I personally support local farmer's markets, the only real competition to the corporate factory farms. Everybody should get out of their suit and tie and get their ass busted, working on a farm. You'll know it, when you step in it.

 http://georgesblogforum.wordpress.com/2011/06/26/land-wealth-vs-debt-pro...

Sun, 10/02/2011 - 19:59 | 1731777 FreedomGuy
FreedomGuy's picture

You still get subsidies at these record high prices, too! Ain't central among great!?!

Sun, 10/02/2011 - 00:00 | 1730170 XRAYD
XRAYD's picture

Wow, an ABBA Bull market begins in the 4th Q, the GS Dancing Queen of BRICs says.

 

Take a chance on it!

Sun, 10/02/2011 - 00:30 | 1730192 Dapper Dan
Dapper Dan's picture

The Plutonium has now officially made it's way into the vanguard.  Let's worry about some things more than others.

All other news from here on out will be inconsequential.

Plutonium detected outside N- plant site Plutonium believed to have been released from the crippled Fukushima No. 1 nuclear power plant after the March 11 earthquake has been detected outside the power plant site for the first time, it has been learned.

One of the spots found contaminated with the hazardous substance is 45 kilometers from the plant.

http://www.yomiuri.co.jp/dy/national/T111001002464.htm

Sun, 10/02/2011 - 00:27 | 1730204 PrintButtonMoney
PrintButtonMoney's picture

Seems like 'benign' and 'better' mean.... 'only mildly malignant' and 'a slower bleed'

How does Germany make up for the rest of the failing EU again?

http://printbuttonmoney.blogspot.com

 

Sun, 10/02/2011 - 13:35 | 1730940 RSloane
RSloane's picture

The German Finance Minister said this weekend that Germany is not going to give any more money to the EU bailout fund. Oops!

Sun, 10/02/2011 - 00:35 | 1730215 fcamargoe
fcamargoe's picture

WTF? is this guy on crack? He is basically dismissing all the risks as BS to the point that he wont even consider thinking about a hard landing in China...too much gloom he says!? Last time I heard about a "soft" landing was in the summer of 2007 when virtually all economists said we need not worry since the US economy is at the worst heading for a soft landing. His comments just reinforce my theory that most of these so called "experts" are nothing more but academics with seven figure salaries. They want the world to follow their "elegant and simple" explanations for human behaviour. They get lost in their models and completely disconnect from reality. When reality doesnt go their way, its reality thats wrong, not their models. These guys have the greatest egos of any. Instead of adapting their views they want to make reality adapt to their views. I hate it that traders get all the heat. I respect that most can be realist and change their thesis quickly. Wall St economists (or any other economists) as well as any one on the sell side, want reality to adapt to their views.

 

 

Sun, 10/02/2011 - 00:40 | 1730219 Perpetual Burn
Perpetual Burn's picture

Stoped reading at " observations from the man who has been wrong about pretty much everything" hahahhaah i love this site!

Sun, 10/02/2011 - 01:22 | 1730248 EhKnowKneeMass
EhKnowKneeMass's picture

We should all worry, as Mr. Kolivakis has just capitulated. Long gone are his sermons about job growth, Chinese solar stocks, buy the dips, etc., etc., etc. Now, finally, the acceptance is here that there is no growth, the economies are in a mess, the market is rigged and only the insiders make money. He even gives kudos to ZH. Welcome home Leo!

I am copying and pasting a couple of paragraphs from his latest posting on his blog.

Most investors are glad this crazy summer is over. This was the worst quarter for the stock market since the financial crisis supposedly ended as the S&P 500 lost 14% in Q3. The only people making money in these markets are high frequency traders, short sellers and a few elite hedge funds. Most investors, including global pensions, got absolutely slaughtered in Q3.

I also got hit but my trip to Greece saved me because I wasn't in the mood to trade much while on vacation and when I got back, cut some losses and got out of this market altogether.

Sun, 10/02/2011 - 07:54 | 1730487 Ned Zeppelin
Ned Zeppelin's picture

I wish I could find some of my responses to his 300,000+ payrolls coming soon pronouncements of 2 years ago. No drivers for it, dude, none at all. And the elites are still gaining ground on the rest of us.  

Sun, 10/02/2011 - 08:07 | 1730496 nmewn
nmewn's picture

Leo was nothing but a central planning shill who couldn't find his ass using both hands.

If his investing advice were not free, it would have been borderline criminal.

Sun, 10/02/2011 - 02:06 | 1730281 TheLooza
TheLooza's picture

His commentary has all the telltale markings of having been penned by someone with a full bank account minus the $1k he just spent to blow a tranny.

Sun, 10/02/2011 - 02:18 | 1730288 Grand Supercycle
Grand Supercycle's picture


Analysis originally posted on my blog Feb 16, 2011.

“When DOW/S&P500 correction gathers momentum I expect:
UP ~ USD, various USDXXX currencies, VIX Index
DOWN ~ EURUSD, AUDUSD, NZDUSD, GOLD/SILVER, Base metals like COPPER etc, CRUDE OIL”

http://stockmarket618.wordpress.com

Sun, 10/02/2011 - 04:02 | 1730368 Coldfire
Coldfire's picture

Excrescent.

Sun, 10/02/2011 - 05:39 | 1730426 Mr_Wonderful
Mr_Wonderful's picture
Frankenstein finance: How supercomputers preying on human fear are taking over the world's stock markets Read more: http://www.dailymail.co.uk/debate/article-2043943/ROBERT-HARRIS-How-supercomputers-preying-human-fear-taking-worlds-stock-markets.html#ixzz1ZcEqFBtq
Sun, 10/02/2011 - 06:26 | 1730445 bentaxle
bentaxle's picture

There will be a "big bang" in Europe Jim,....... just not the kind you're thinking!

Sun, 10/02/2011 - 06:43 | 1730457 LeftyGoldblatt
LeftyGoldblatt's picture

politics = burdian's ass ?

http://en.wikipedia.org/wiki/Buridan%27s_ass

 

a 3rd option anybody ?

 

 

Sun, 10/02/2011 - 07:29 | 1730477 css1971
css1971's picture

I believe let them eat cake[1] is about the gist.

[1] Brioche isn't stricktly speaking cake.

Sun, 10/02/2011 - 07:55 | 1730482 Ned Zeppelin
Ned Zeppelin's picture

The outcome of all of this is deflation, a hurricane of debt dissolution, and the outlawing of gold in the US, since even in deflation, TPTB have to enforce the fiction that is fiat.  No gold "winners" will be allowed - the rules of the game will be changed to prevent it.

Unless of course the players decide not to play the game anymore.

Sun, 10/02/2011 - 08:27 | 1730513 licamele
licamele's picture

Getting it wrong, one trade at a time. What a spanner!

Sun, 10/02/2011 - 09:01 | 1730556 strateshooter
strateshooter's picture

I have many dreams in life but two are prevalent at the moment...the first is Scarlett Johannson walks up to me in the pub one night and tells me shes feeling horny.The second is that GS goes tits up the water and all associated with it and corrupted by it meet ugly ends.

Both dreams are very relaxing and help me cope with these interesting times.

Sun, 10/02/2011 - 09:07 | 1730562 Woodrox
Woodrox's picture

Dribble

Sun, 10/02/2011 - 09:07 | 1730563 Woodrox
Woodrox's picture

Dribble

Sun, 10/02/2011 - 09:57 | 1730622 PulauHantu29
PulauHantu29's picture

<<(Reuters) - Greece was expected to unveil its plan on Sunday to begin laying off state workers, the most contentious part of a reform package demanded by the EU and IMF to free up loans and stave off bankruptcy.

Without the release of an 8 billion euro ($10.7 billion)tranche of an EU bailout, massively indebted Greece could run out of money to pay state wage bills within weeks.>>

http://www.reuters.com/article/2011/10/02/us-greece-idUSTRE7900SU20111002

Sun, 10/02/2011 - 10:45 | 1730708 MsCreant
MsCreant's picture

Wow, it could cost more money than they have to lay people off. The ink costs alone to print pink slips...

Sun, 10/02/2011 - 09:58 | 1730623 max2205
max2205's picture

Federated funds Europe-heavy, yet lower in risk
Sunday, September 25, 2011
By Len Boselovic, Pittsburgh Post-Gazette
Each day brings new headlines about the European debt saga, as regulators and diplomats work to prevent the Greek government's problem in making its loan payments from becoming a global credit crisis reminiscent of the 2008 collapse of Lehman Bros.

Key players in the drama are European banks, which hold the debt issued by Greece and other troubled European countries collectively known as the PIIGS: Portugal, Italy, Ireland, Greece and Spain.

Also at risk are investors who buy debt issued by those European banks. They could have problems if the banks are shaken by a default by Greece or another stressed member of the European Union.

Those investors include money markets fund operators such as Federated Investors. Assets in the Pittsburgh investment manager's money market funds totaled $265.7 billion as of June 30, accounting for 76 percent of the $349.4 billion that Federated manages for investors.

Federated has more exposure to European banks than many of its competitors: on average 40 to 45 percent in most of the prime money funds it manages, according to Deborah A. Cunningham, chief investment officer for Federated's taxable money markets funds. Prime money funds invest in short-term, high quality debt issued by banks, corporations and the U.S. government.

Ms. Cunningham said Federated's position is based on a thorough, daily analysis of the capital, asset quality, management, earnings and liquidity of the 16 European banks with global operations whose debt is on Federated's books. Based on that analysis, Federated has come to a conclusion you won't find in the headlines.

"There's still value in select European senior bank debt since the banks continue to represent minimal credit risk," Ms. Cunningham said Thursday in a note to clients. "The exposure that European banks on our approved list have in the most troubled euro-zone countries is relatively minimal."

In an interview, Ms. Cunningham said the European debt that the funds hold is short term, which allows Federated to readjust its portfolio as the situation warrants. Much of it is in French and United Kingdom banks that issue large amounts in maturities Federated is interested in, she said.

She believes a Greek default would affect the earnings of the European banks, but not threaten their solvency.

So what additional yield is Federated getting from the European bank debt?

Ms. Cunningham said three-month French, German and U.K. bank debt currently pays about 0.4 to 0.45 percent vs. 0.3 to 0.35 percent for similar debt issued by U.S., Japanese and Australian banks. That's a 30 percent premium at a time when money market funds are delivering meager returns.

In a Sept. 9 note to clients, JPMorgan Chase analysts described Federated's greater European bank exposure relative to its peers as "not necessarily wrong, just different." They noted that investors continued putting money into the funds early this month. They rate Federated's stock underweight, citing the impact possible regulatory changes and the Federal Reserve's low interest rate policy will have on the company's money market business as well as the risk posed by European investments.

Morningstar analyst Greggory Warren believes regulation is more of an issue than the European exposure.

"I'm never worried too much about them moving up the risk spectrum," Mr. Warren said. "I still think the greater risk for them is the government doing something goofy with regulation."

He has a "hold" recommendation on Federated's shares and said investors should think about buying if the stock approaches $12. Federated closed Friday at $17.29, down 46 cents for the week and off 34 percent for the year.

Ms. Cunningham offered three scenarios for how Greece's debt crisis will play out.

The most benign is that the government will implement enough austerity measures to qualify for the mid-October installment of aid that is part of a rescue plan European officials engineered this summer. That outcome is the most likely, but it's less likely than it was two months ago, she said.

Or there could be another organized restructuring or default that is supervised and well telegraphed to the markets. That would involve holders of Greek government debt accepting less than full value for their loans, Ms. Cunningham said.

The most dire scenario would be Greece dropping out of the EU, reverting to its own currency and halting debt repayment for the time being. "Then you've got a little bit of mayhem after that," she said.

Even if that would happen, Ms. Cunningham is confident Federated's rigorous credit analysis and the short-term nature of its European bank debt would provide a shield from the fallout.

"The global banks in which Federated invests ... have operations around the world, potentially enhancing their ability to withstand events in any single country," she told clients in her Thursday note.

Besides Federated's internal analysis, the fact that the European debt in Federated's money funds is also scrutinized by U.S. regulators contributes "to our confidence that use of these carefully selected securities from major global European banks should continue to benefit our funds," she wrote.

Len Boselovic: lboselovic@post-gazette.com or 412-263-1941.

First published on September 25, 2011 at 12:00 am

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[what's this]

Sun, 10/02/2011 - 10:14 | 1730650 LP9
LP9's picture

Out of touch, overpaid, irrational, emotional. Time for stronger meds.

Sun, 10/02/2011 - 10:48 | 1730702 Mr_Wonderful
Mr_Wonderful's picture

So this Goldman guy wants to rally like in 1980.

In 1980 GDP was $3 Trillion, now it´s 15 Trillion up 400%.

In 1980 total credit market debt was 5 Trillion, now it´s 52 Trillion, up 940%.

In 1980 Uncle Sam´s debt was .9 Trillion, now it´s 15 Trillion, up 1600%.

The system is way oversaturated with debt and has been stalling from vanishing returns. The correction will take years.

Sun, 10/02/2011 - 11:25 | 1730758 Reese Bobby
Reese Bobby's picture

Good job Squid-boy.  When all else fails, revert to third grade level commentary...

Sun, 10/02/2011 - 11:27 | 1730761 JW n FL
JW n FL's picture

 

 

J.P. Morgan Chase "donates" $4.6 Million to NYPD ... www.ericallenbell.org/.../j-p-morgan-chase-donates-4-6-million-to-n... You +1'd this publicly. Undo

1 day ago – JPMorgan Chase recently donated an unprecedented $4.6 million to ... as well as security monitoring software in the NYPD's main data center. ...

?

·  Quelle Surprise! "J.P. Morgan Chase "donates" $4.6 Million to NYPD ... stopforeclosurefraud.com/.../quelle-surprise-j-p-morgan-chase-donat...Cached You +1'd this publicly. Undo

20 hours ago – JPMorgan Chase recently donated an unprecedented $4.6 million to the ... Tags: 4.6 Million, donation, jamie dimon, jpmorgan chase, NYPD ...
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·  JP Morgan chase bank donates 4.6 million to NYPD,coincidence ... https://occupywallst.org/.../jp-morgan-chase-bank-donates-46-million...Cached You +1'd this publicly. Undo

News and resources for protesters attending the mass demonstration on Wall Street against financial greed and corruption.

·  JP Morgan Chase donated $4.6 million to the NYPD - Democratic ... www.democraticunderground.comDiscuss You +1'd this publicly. Undo 1 post - 1 author - Last post: 7 hours ago

JP Morgan Chase donated $4.6 million to the NYPD.
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·  Daily Kos: JP Morgan buys NYPD for $4.6 million www.dailykos.com/story/.../-JP-Morgan-buys-NYPD-for-$46-million You +1'd this publicly. Undo

5 hours ago – JPMorgan Chase recently donated an unprecedented $4.6 million to ... as well as security monitoring software in the NYPD's main data center. ...

 

and then.. 2 fucking days later?

 

·  700 arrested on Brooklyn Bridge after protest
USA Today - 12 minutes ago During Saturday's march on the Brooklyn Bridge, some protesters sat on the roadway, chanting "Let us go," while others chanted and yelled at police from the ...

1846 related articles

·  700 arrested after protest on NY's Brooklyn Bridge
Fort Wayne Journal Gazette -
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·  Police Arrest More Than 700 Protesters on Brooklyn Bridge ... cityroom.blogs.nytimes.com/.../police-arresting-protesters-on-brookl...Cached You +1'd this publicly. Undo

17 hours ago – The police arrested more than 700 demonstrators from the Occupy Wall Street protests who took to the roadway as they tried to cross the ...
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·  700 arrested at Brooklyn Bridge protest - CBS News www.cbsnews.com/stories/2011/10/02/.../main20114436.shtmlAdd to iGoogle You +1'd this publicly. Undo

2 hours ago – Mass arrests as "Occupy Wall Street" demonstrators block traffic lane; Similar protests spread to other cities.
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·  700 arrested after protest on NY's Brooklyn Bridge - Yahoo! News news.yahoo.com/700-arrested-protest-nys-brooklyn-bridge-0300091... You +1'd this publicly. Undo

2 days ago – Read '700 arrested after protest on NY's Brooklyn Bridge' on Yahoo! News. Protesters speaking out against corporate greed and other issues ...

 

That is how Corrupt our Country has become.

The excuse?

NYPD could not afford to police its streets..

NYPD could not afford to Jail all those people..

So? JP Morgan used Tax Monies / Bailout Monies (some of the TRILLIONS we GAVE TO JP MORGAN, FOR FREE!) to use against "We the People"!

the excuse being.. that "We the Sheepish Consumers" can NOT Tell when JP MORGAN HAS A 24 Inch Cock Crammed Up our Collective asses!

I know that some of you bottom feeders here will be grateful that JP Morgan used $4.6 Million dollars of TAX PAYER Money to fuck with Tax Payers.. because you think you will one day be one of those using tax dollars against "We the People" to control us.. because we are sooooooooooo fucking stupid that we are unable to treat other people like human beings.. or maybe because the majority refuses to treat other Human Beings like a Cow that should be leveraged and drained of every penny possible.

The time is coming when all those toys.. will be spread around, for FREE to others to play with.

Your Time is coming to an end and NONE too soon.

 

The investigation also revealed that the Fed outsourced most of its emergency lending programs to private contractors, many of which also were recipients of extremely low-interest and then-secret loans.

The Fed outsourced virtually all of the operations of their emergency lending programs to private contractors like JP Morgan Chase, Morgan Stanley, and Wells Fargo. The same firms also received trillions of dollars in Fed loans at near-zero interest rates. Altogether some two-thirds of the contracts that the Fed awarded to manage its emergency lending programs were no-bid contracts. Morgan Stanley was given the largest no-bid contract worth $108.4 million to help manage the Fed bailout of AIG.

A more detailed GAO investigation into potential conflicts of interest at the Fed is due on Oct. 18, but Sanders said one thing already is abundantly clear. "The Federal Reserve must be reformed to serve the needs of working families, not just CEOs on Wall Street."

http://sanders.senate.gov/imo/media/doc/GAO%20Fed%20Investigation.pdf

 

 

Sun, 10/02/2011 - 23:39 | 1732207 Fiat Money
Fiat Money's picture

[multiple headlines] - JP Morgan Chase donated $4.6 million to the NYPD...

....and then.. 2 fucking days later?

 ·  700 arrested on Brooklyn Bridge after protest
USA Today - 12 minutes ago During Saturday's march on the Brooklyn Bridge, some protesters sat on the roadway, chanting "Let us go," while others chanted and yelled at police from the....

 ------------------------------------------------

   Don't forget for a moment, the NYPD - rank & file - have been LOOTED of their PURCHASING POWER, by Bernanke's  "dilute YOUR shares" dollar debasement;  and  by the gs, jpm, citi, boa PUMP & DUMP attacks on pensions; and by the Fed loan-sharks'  Disaster Capitalism "Bailouts" extortionists. 

  BUT!  As that Civil War era Wall St.  banker said, "You can always hire one-half of the poor, to kill the other half."  -     

 Same ol' same ol,  some things NEVER change, but the colors of the brown/black/blue uniforms...  

Sun, 10/02/2011 - 15:13 | 1731160 Zero Govt
Zero Govt's picture

"Presenting some deeply philosophical observations from the man who has been wrong about pretty much everything.."

That's philosophy for you! ...a form of detached from reality thinking from the rectum of academics and other lay-abouts

Only the commercially trialed, competed and proven brain is of any use on the Planet ...the rest of the 'thinkers' like economists produce nothing but f'ing dribble


Sun, 10/02/2011 - 15:20 | 1731176 Imminent Crucible
Imminent Crucible's picture

It's all surreal to Jim O'Neill,

Enjoying Abba with his meal

"What's wrong with you ungrateful hacks

Who pay the bills for Goldman Sachs?"

 

Jimmy is a total ass.

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