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News Round-Up: 01 Apr 2008






Food Price Inflation Changes How We Shop – Chicago Tribune (3/31/2008)Fed eyes Nordic-style nationalisation of U.S. banks – UK Telegraph (4/1/2008)UBS writes off $19 billion – Yahoo! News (4/1/2008)Deutsche Bank Expects $4B Subprime Hit – Yahoo! News (4/1/2008)WaMu Alt-A Pool Deteriorates Further – Michael Shedlock (4/1/2008)Lehman raises $4 bln of capital to quell critics – Yahoo! News (4/1/2008)The Wheels Fall […]

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How we got into this mess






A few days ago Comstock Partners released a Special Report outlining how we got into the economic malaise that is hitting us right now. Their report is spot on in terms of the genesis of our problems being easy money. They also accurately note that we should have had a major recession in 2001 given the historically large tech bubble […]

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Is the Fed reckless?






Recently, on Mar. 18th, the Federal Reserve lowered the Fed Funds rate to 2.25%. In the accompanying statement, the Fed said the following: “Recent information indicates that the outlook for economic activity has weakened further. Growth in consumer spending has slowed and labor markets have softened. Financial markets remain under considerable stress, and the tightening of credit conditions and the […]

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A populist interpretation of the latest Boom-Bust cycle






This is a story of unequal re-distribution of wealth from the less fortunate to the more fortunate. This is a story of the United States in which the rich get richer at the expense of everybody else. At the conclusion, ask yourself: is this true and, if so, what should we do about it?






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It’s the debt, stupid






Note from June 2010: You’ll forgive me if I have conflated private and public sector debt below as if they are the same. They are not. When I speak of deficit spending in the same voice as private sector debts, I really point to deficits to maintain the status quo ante as promoting the accumulation of private sector debt. The […]

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State and local governments: budget cuts likely






As the housing bubble pops, one major casualty is likely to be state and local government property tax receipts. It appears that state and local governments recklessly spent the windfall revenue that they received during the boom times and have been caught out now that the boom has turned to bust. Not a day goes by without commentary in the […]

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The dollar collapses






The dollar has suffered a spectacular collapse against the Euro, Swiss Franc, Gold and Silver as investors flee U.S. Assets in the wake of the spectacular collapse of one of Wall Street’s largest companies, Bear Stearns. The Swiss Franc recently traded through parity with the dollar at 0.9776. The Euro climbed 3 big figures to a record 1.5819. Gold and […]

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Bear Stearns collapses






The credit bubble has claimed its first major finance company: Bear Stearns. The venerable firm, which traded as high as $160 in 2007 and was trading above $60 just last week, was bought for a mere $2 per share by rival JP Morgan Chase and Co. From my point of view, this is the first of many spectacular events which […]

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Economic News Round-Up






Economic News Round-upI am off to the beach for a week, so I thought I would highlight a few stories that I have found particularly interesting as opposed to writing anything of substance today. JP Morgan Chase, Fed Funding Bear Stearns – Washington Post (3/14/2008)Anatomy of a Carlyle Collapse – Washington Post (3/14/2008)Washington Mutual Rate Cut to Near Junk – […]

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Has anyone noticed the Dollar has gone into freefall?






The Fed has pulled out all the stops to fight against the severe credit crunch that first hit our economy in August. The latest salvo in this mission is the Fed’s decision to allow banks to trade $200 billion in dubious mortgage backed securities for risk-free treasurys. But, all this has done is reinforce the impression that the U.S. Federal […]

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About Credit Writedowns






Credit Writedowns (www.creditwritedowns.com) is a news and opinion site dedicated to bringing a well-informed view of finance, economics, markets and all relevant global events into the global mainstream consciousness. The site started in March 2008 and has become one of the highest-ranked economics and finance blogs on the net (now in the top 25 by traffic). Posts by its authors […]

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Populism: The real economic danger in this recession






When the going gets tough, the tough turn into populists. Or at least that’s what we have seen time and again throughout history. In the 1930s, as the Great Depression was savaging the American Economy, people trembled in fear at the economic devastation. Members of Congress, sensing they needed to do something to address those fears, enacted the Smoot-Hawley Tariff […]

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