Wednesday, September 17, 2008

Alice's bubble wrap

UK unemployment soars at fastest rate since 1992

See my chart below....

Bank of England extends credit-crunch facility for banks

I thought I heard Mr. King say last week that the Special Liquidity Scheme would be closed in October. The Bank of England has extended it to January.

With HBOS under renewed attack, forced takeover may be the solution

From Jeremy Warner of the independent. I think HBOS are ahead of you, Jeremy.

Investors buy government bonds on recession fears

"Fund managers moved to overweight on government bonds for the first time in at least 10 years as recession fears replace inflation concerns, prompting fear trade into safe-haven assets, a Merrill Lynch poll showed on Wednesday."

Our (Irish) banks bobbing in debt-infested waters

"Ireland's banks, for the moment, protest their resilience to the global forces that have wreaked havoc on Wall Street. AIB had the temerity to raise its interim dividend during the summer, a move that was designed to show the financial markets how robust it was. The truth, however, is more difficult to discern."

Fire sale threat hangs over Spanish stakeholdings

With everything else going on, I try to not forget about the Spanish housing catastrophe - the "mujer" of all bubbles.

Fed keeps rates fixed.

One small mercy....

AIG reaches the end of the line

Well worth reading, and not just because I get a mention.....

Two US senators talking

Senator Gregg: “I don’t see any shoes out there that meet the standards of Freddie Mac, Fannie Mae or AIG.

Senator Dodd: “I agree with that.”

NPR: "Meaning there won't be another huge huge bailout of this kind? You don't see one on the horizon?

Gregg: “I don’t see any entities out there that appear to be in trouble that meet this type of standard--that they would melt down the entire system if they went under.”

Dodd: "Some banks. Some banks, some regional banks, but nothing of the size of AIG, Lehman Brothers or Merrill Lynch."


  1. Good stuff re the mention.

    I like your new blog header as well.

  2. You KNOW that senator Dodd is retarded, right? And completely in the pocket of the NAR.


  3. Yes, our Congress Critters do everything but eat bananas and swing on the chandeliers.

    Not that long ago Pelosi, the House leader, gave an interview in which she said we should expand the use of natural gas in order to move away from fossil fuels.

  4. It didn't occur to them that the Treasury might fail. What would be called, were it French, the First Republic failed, with its Articles of Confederation being replaced by The Constitution. Why shouldn't the Second Republic fail too?

  5. Hmmm - the SLS extension deserves some high-level questions.

    I've no real problem with the idea that the SLS will be extended until January from the 21st October, but I would be rather displeased if the amount lent "to date" is also delayed. The secrecy of the amounts in question is significant - estimates are diverging - is it less than £50bn, about £200bn or £800bn... or more? The longer this is left to continue, the greater the uncertainty about our public accounts - and hence - the greater our uncertainty about foreign exchange - and this, especially in the context of a global economy, is significant.

  6. Alice - love the new header, as you might expect!


    B. in C.

  7. Alice - I'm reading on CNN ("How we here: It's housing, stupid") that in inflation-adjusted dollars the US bubble was 85% 1996-2006.

    What exactly would be the equivalent figure on your header diagram to the 2007 peak - and what could be deduced from it's greater size?

    B. in C.

  8. Not that long ago Pelosi, the House leader, gave an interview in which she said we should expand the use of natural gas in order to move away from fossil fuels.

    Well it's natural you see. Completely 100% natural. That means it's good.

    Fossils are old and dead and so are bad. A bit like Pelosi except they burn better.

  9. Alice,

    I thought Barclays had weak capital ratios. Their recent rights offering was a dud if memory serves.

    Any thoughts on their Lehman purchase?

  10. Their rights issue was underwritten which means they still got all their money.

    Just the underwriters ended up with a shed-load of shares...

  11. Level 3 assets have been my hobby horse for a while. Have a look at this chart:

    and tell me if there institutions have anything else in common.