{"id":196962,"date":"2008-03-11T17:04:00","date_gmt":"2008-03-11T22:04:00","guid":{"rendered":"https:\/\/www.panix.com\/~msaroff\/40years\/2008\/03\/11\/economics-update-503\/"},"modified":"2008-03-11T17:04:00","modified_gmt":"2008-03-11T22:04:00","slug":"economics-update-503","status":"publish","type":"post","link":"https:\/\/www.panix.com\/~msaroff\/40years\/2008\/03\/11\/economics-update-503\/","title":{"rendered":"Economics Update"},"content":{"rendered":"

Oil has hit another new high<\/a>, driven largely by the Dollar hitting a new low<\/a>, though there has been some recovery since the Federal Reserve has agreed to issue at least another $200 billion<\/a>, this time using mortgage backed securities, aka “Worthless Garbage”, as collateral.<\/p>\n

I’m not sure that this will make a difference in the strength of the Dollar. It now appears that the United Arab Emirates is seriously considering dumping their dollar peg<\/a>, which is clearly a step towards Euro denominated oil.<\/p>\n

In today’s episode of really bad policy, it appears that Congress is moving toward privatizing profits and socializing losses in real estate, by expanding the loans that FHA insurance covers<\/a>. Yep, this will work so well, like it did for MBIA and Ambac.<\/p>\n

In more general investment news, Bear Stearns is tanking on concerns that it lacks sufficient liquidity<\/a> to cover potential margin calls. It probably does not help that Moody\u2019s has downgraded Bear Stearns Alt-A mortgage backed securities<\/a>, more than half of those issued from 2005 through 2007. Ouch.<\/p>\n

Subprime’s favorite whipping boy, Countrywide is going down like Elliot Spitzer’s hooker<\/a>, the Bank of America offer is now a 32% premium, as versus a 9% premium 2 weeks ago, so people are thinking that BoA will just walk away.<\/p>\n

In the world of Real Estate Investment Trusts (REITs), we have had downgraded price targets on three Mortgage REITs<\/a>. <\/p>\n

What took them so long.<\/p>\n

Finally, in things that make you say, Whiskey Tango Foxtrot, we have a report that, 20% of Silicon Valley startups cannot get to their working cash<\/a>, because they invested it in Auction Rate Securities to get better rates of return, and that market is completely frozen.<\/p>\n","protected":false},"excerpt":{"rendered":"

Oil has hit another new high, driven largely by the Dollar hitting a new low, though there has been some recovery since the Federal Reserve has agreed to issue at least another $200 billion, this time using mortgage backed securities, aka “Worthless Garbage”, as collateral. I’m not sure that this will make a difference in …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1080,973,1004,985],"tags":[],"class_list":["post-196962","post","type-post","status-publish","format-standard","hentry","category-currency","category-economy","category-finance","category-regulation"],"_links":{"self":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/196962"}],"collection":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/comments?post=196962"}],"version-history":[{"count":0,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/196962\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/media?parent=196962"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/categories?post=196962"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/tags?post=196962"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}