Mish's Global Economic Trend Analysis |
- Thanks to Fed, Bubble Builds in Junk Bonds; We Know How Bubbles End
- Economic Stimulus on Whiteboard; Good News on the Political Front in WA6
- BofA, JPM get Texas Subpoenas; Class Action Suit Against BofA; "Pit Bull" vs. BofA in Mortgage BuyBack Battle
Thanks to Fed, Bubble Builds in Junk Bonds; We Know How Bubbles End Posted: 26 Oct 2010 12:34 PM PDT The Fed's misguided policies have not done a thing for small businesses, the unemployment rate, or the real economy in general but they have induced a mad dash for yield in junk bonds, easily in a bubble state right now. Byran Keogh writing for Bloomberg says Fed-Induced Rally Makes Riskiest Debt Priciest The lowest-rated junk bonds are the most expensive corporate debt following a Federal Reserve- induced rally in high-risk assets, adding to concern fixed- income securities are overvalued.We Know How Bubbles End As long as there is a strong bid for junk, the stock market is unlikely to crack hard. Yet, we know how bubbles end. The Greenspan Fed ignored the dot-com bubble, even encouraged it because of misguided Y2K fears and belief in productivity miracles. When that bubble burst, the Fed promptly embarked on creating a second, far bigger bubble in housing and debt. Now the Fed is actively promoting still more bubbles as a solution to god knows what, since the Fed's policies are not helping the real economy one iota. In fact, the Fed's policies are helping neither the real nor unreal economies unless you consider creating another opportunity for Goldman Sachs and select hedge funds to short at the opportune time, appropriate "help". Fed Uncertainty Principle in Action Long-time readers will quickly spot the Fed's actions as Fed Uncertainty Principle Corollary Number Three Don't expect the Fed to learn from past mistakes. Instead, expect the Fed to repeat them with bigger and bigger doses of exactly what created the initial problem. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List |
Economic Stimulus on Whiteboard; Good News on the Political Front in WA6 Posted: 26 Oct 2010 11:14 AM PDT This is a political post but a video clip from Dough Cloud also shows rather well how Congress works. In addition to the above video, I have good news to report in the campaign front. Doug Cloud, a Ron Paul type candidate, has pulled into the lead in his race for his race in Washington District 6. Doug writes ... Dear Mish,Race Washington Overlooked The National Review asks Could There Be One More Competitive House Race in Washington, Completely Overlooked? Congressman Norm Dicks: 17-term incumbent Democrat in Washington. Chairman of the House Interior and Environment Appropriations Subcommittee. Represents a D+5 district that includes parts of Tacoma and Bremerton and Port Angeles. Obama carried 57 percent of the vote; Dicks usually wins with 60some percent of the vote and hit above 70 percent a few times.They Do Now! What To Do - How You Can Help Just yesterday a reader with some money to contribute asked how to make the best use of it. My answer was to donate to campaigns now considered tossups. Since one poll is not necessarily accurate, certainly Doug Cloud's campaign is worthy as well. Please see my endorsement Doug Cloud for Washington District 6 - Tacoma. The post contains information on how to volunteer time and money. Battle for House and Senate On a national level, Real Clear Politics shows an election map with all the tossup races in play in Battle for the House. Here is a map depicting the Battle for the Senate There are many candidates worthy of your support, and Doug Cloud is a standout. It is not often one gets the chance to elect a Ron Paul type candidate against a corrupt long-term opponent on the take. Do not let these chances slip away. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List |
Posted: 26 Oct 2010 02:15 AM PDT The mortgage mess gets more complicated every day. Here are a sampling of stories that shows how. Bank of America, JPMorgan Get Texas Subpoenas on Foreclosures Bloomberg reports Bank of America, JPMorgan Get Texas Subpoenas on Foreclosures Bank of America Corp., JPMorgan Chase & Co. and seven other banks or loan servicers were subpoenaed by Texas Attorney General Greg Abbott for information about their foreclosure practices, a spokesman said.Class Action Filed Against Bank of America For Foreclosure Fraud Law.Com reports Bank of America Sued in Class Action Over Flouting of Foreclosure Rules Bank of America has been hit with a class action on behalf of homeowners seeking damages for alleged disregard of foreclosure process rules.Fed's 'Pit Bull' Takes on Bank of America in BuyBack Battle Bloomberg reports Fed's 'Pit Bull' Takes on Bank of America in BuyBack Battle Kathy D. Patrick is a Houston lawyer who spends her Sundays teaching children about God. The rest of the week, according to one attorney who knows her, she can be "as frightening as a pit bull on steroids."Bair Says Regulators Will Uncover More Flaws in Foreclosures The understatement of the month award goes to Sheila Bair at the FDIC who says Regulators Will Uncover More Flaws in Foreclosures Regulators are likely to discover more problems related to loan servicing by some of the biggest banks as they probe claims that documents were mishandled, Federal Deposit Insurance Corp. Chairman Sheila Bair said.If you get the idea foreclosure fraud is going to trigger a tangled mess of lawsuits and countersuits, you have the right idea. This can easily drag on for years unless (and perhaps even if) Congress gets involved. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List |
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