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HS Dent
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Helping people understand economic change.
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GM Set To Earn A Profit - And Other Fairy Tales
GM lost $88 billion from ‘04 through its demise in ‘09. Then it went bankrupt. Then it stiffed any investor creditor. Then it cut a sweetheart deal with organized labor. Along the way it received a full $50 billion -think about that number, $50 billion - of our taxpayer money. The company came out leaner of [...]
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Shadow Inventory of Foreclosed Homes Coming To the Fore
Barclays capital estimates that bankers and investors held an additional 28k of foreclosed homes in January. The pace of foreclosures stalled at the end of 2009 as banks and lenders tried to figure out who might qualify for government sponsored/pushed/demanded modification programs. Needless to say, the number of people who qualify is a small fraction [...]
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India and China
The Times of India ran an interesting headline this morning: “India to be fastest growing economy by 2018”
According to the article, India will overtake China, currently the fastest growing economy. This wouldn’t surprise me one bit.
China is an economic miracle, to be sure. It is commendable how the Chinese have managed to pull so many [...]
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Moody’s to Change US Muni Ratings - And No One Cares
http://www.ft.com/cms/s/0/e24a7854-3135-11df-8e6f-00144feabdc0.html
Moody’s, the debt-rating firm that sold its soul in order to cash in on all the mortgage backed securities, is “shaking up” its system for rating municipal debt. Really? And who cares?
Moody’s was an old line municipal bond rating agency. The profit margin and growth rate of this business is, well, boring. As corporate debt [...]
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The Emerging Market Bond Bubble
The first quarter of 2010 saw record issuance of emerging market bonds. It also saw the spread on those bonds fall to only 2.57% over the US Treasury rate, according to the Financial Times (see “Emerging market bond sales hit record high“). The FT writes,
Sovereign bond markets in developing countries have seen a record $129bn [...]
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