{"id":197363,"date":"2008-02-11T17:32:00","date_gmt":"2008-02-11T22:32:00","guid":{"rendered":"https:\/\/www.panix.com\/~msaroff\/40years\/2008\/02\/11\/economics-update-525\/"},"modified":"2008-02-11T17:32:00","modified_gmt":"2008-02-11T22:32:00","slug":"economics-update-525","status":"publish","type":"post","link":"https:\/\/www.panix.com\/~msaroff\/40years\/2008\/02\/11\/economics-update-525\/","title":{"rendered":"Economics Update"},"content":{"rendered":"

Chancellor of the exchequer, Alistair Darling has stated at a G-7 forum that the credit crunch will be a “prolonged adjustment”<\/a>.<\/p>\n

Auditors for AIG, the world’s largest insurer is showing “material weakness” ovalues some of its complex financial instruments, specifically its, “credit-default swap portfolio”, see here<\/a> and here<\/a>.<\/p>\n

Basically, it needs to write down more of its holdings in the big sh^%pile.<\/p>\n

In related news, credit-default swaps are becoming more expensive across the markets<\/a>, which reflects the standard risk\/return equation. People find these riskier, so they are demanding higher yields.<\/p>\n

In real estate, experts are saying that home prices will drop for 2 more years<\/a>. I think that it will be 5+ years, at least adjusted for investment.<\/p>\n

A Morgan Stanley analyst has stated the obvious, that Fannie Mae will be seeing a lot mroe defaults on its loans<\/a>.<\/p>\n

In personal finance, credit card companies are jacking up rates of credit worthy customers<\/a>. It appears that they are looking for cash flow to offset losses in various financial derivatives and the mortgage market.<\/p>\n

Rupert Murdoch<\/strike> Dow Jones is ajusting the Dow Jones Industrial Average<\/a>, with Bank of America and Chevron replacing Honeywell and Altria.<\/p>\n

This really does not mean much, after all the Dow is not really a good metric anyway, Honeywell has become too small, and with the spinoff of Kraft, Altria is pretty much just tobacco. Nothing to see here, move along.<\/p>\n

Finally, I recommend that you check out this examination of the US financial position compared to meltdowns in 5 other counties<\/a>. It’s kind of grim, as these charts show:
The Big Picture | 5 Historical Economic Crises and the U.S.<\/a> look at pics”\/>


<\/p>\n","protected":false},"excerpt":{"rendered":"

Chancellor of the exchequer, Alistair Darling has stated at a G-7 forum that the credit crunch will be a “prolonged adjustment”. Auditors for AIG, the world’s largest insurer is showing “material weakness” ovalues some of its complex financial instruments, specifically its, “credit-default swap portfolio”, see here and here. Basically, it needs to write down more …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1261,973,1265,1088],"tags":[],"class_list":["post-197363","post","type-post","status-publish","format-standard","hentry","category-bubble","category-economy","category-housing-crash","category-real-estate"],"_links":{"self":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/197363"}],"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=197363"}],"version-history":[{"count":0,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/197363\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/media?parent=197363"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/categories?post=197363"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/tags?post=197363"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}