“All the news that fits, we print!”
This is the news summary from mainstream media sources (MSM), blogs, financial professionals and our analysis. We provide this to give you a short overview of what is happening in the world based on some of this blog’s themes (international finance, charts, markets, and so on). Please comment so we can improve our selection to make this section useful.
Global summary
The markets seem to be in a sort of malaise. US stocks were down yesterday 0.75% for the S&P, the Dow was down 1.51%. Gold reached 901.6 while oil barely moved at 40.30. The dollar gained against major European currencies. Obama’s economic stimulus plan and failure to move it through Congress fast enough (or in tact) weigh on already negative sentiment which faces more bad news every day.
Alternative Assets
- Clusterstock notes the growing market for secondary offerings [1] of private equity limited partnerships (LP stakes). The market is mainly LPs who cannot or don’t want to fulfill their LP commitment to their funds and are willing to sell their LP investment at a steep discount (kind of like a private equity pawn shop).
International Markets
- Russia’s financial situation worsens according the FT [2]. The CBR spends about $10 billion per week to defend the rouble. The currency reserves are down to about $387 billion [3], but Russia must legally retain $200 billion in its sovereign wealth fund and a balance of payment deficit of $81.5 billion is set aside, so Russia has $60 billion (or more frighteningly, 6 weeks) left to defend the rouble corridor set back in January [4].
Politics
- Bloomberg reports that Obama economic adviser and former Fed Chair Paul Volcker may not be getting along [5] with National Economic Council Director Larry Summers, thus leading to some of the policy roadblock we see in Washington.
From the Blogosphere
- Byron King at Whiskey and Gunpowder asks whether our problems could be the result of living in too complex of a world [6]. As we in finance are supposed to know, the more complex the model, the worse the result (garbage in, garbage out).
- The Decline and Fall of Western Civilizations sees the U.S. stimulus plan, a.k.a. TARP II as heading for deep trouble [7]. The blog points out the plan’s cost to the taxpayer, the inequity of letting bad management escape unscathed and the possibility that the whole thing won’t work. Perhaps we should use the German or Swedish models?