kent nickell
Well-known member
“”Yet there is also something wrong with the fire sale view. Many of its advocates treat the dollar’s decline as if it were some kind of exogenous event, foisted upon the country by Secretary of State James Baker. They also treat the sale of U.S. assets at bargain prices as if it represents a pure windfall to foreign investors. This cannot be right. If U.S. assets are such a good buy, then why is it that their prices do not get bid up? And if it is now so attractive to invest in the United States, should not the desire to keep investing here drive up the value of the dollar? The point is that neither asset prices nor the value of the dollar (which is an asset price itself) can be regarded as given.
It is a mistake, however, to decry the fire sale as some kind of mistake of exchange policy.
The only way to avoid a fire sale is not to need one – that is, to provide enough domestic saving so as to avoid reliance on foreign capital inflows.
So the policy moral of this analysis is one that has become boring through repetition but is still as true as ever. The United States needs to restore its national savings rate to historical levels as soon as it can”””
The above are excerpts from Currencies and Crises, Paul Krugman, 1992
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Good interview with Josh Rosner http://www.blinkx.com/video/rosner-expects-messy-earnings-from-u-banks/06WAa_cPHp71OGxfxZj-rQ
"""good bank earnings reports but supported by very little disclosure, flies in the face of deteriorating credit quality, no real information on how they got to this 'earnings' number, can't put a floor under the housing problem until there is a floor under the unemployment problem, there is a danger to offering sweet deals (essentially full faith offerings) to Goldman Sachs, Wellstone, PIMCO, BlackRock, Blackstone, Bridgewater etc while expecting foreign countries to keep buying low interest treasuries.., basic problem is still dealing realistically with toxic assets.(which may need nationalization to get current management out of the way) """
It seems like the banks can come clean sooner or later... Either way will be bad for the stock market.. Later could seriously impinge on the administrations credibility.....
It is a mistake, however, to decry the fire sale as some kind of mistake of exchange policy.
The only way to avoid a fire sale is not to need one – that is, to provide enough domestic saving so as to avoid reliance on foreign capital inflows.
So the policy moral of this analysis is one that has become boring through repetition but is still as true as ever. The United States needs to restore its national savings rate to historical levels as soon as it can”””
The above are excerpts from Currencies and Crises, Paul Krugman, 1992
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Good interview with Josh Rosner http://www.blinkx.com/video/rosner-expects-messy-earnings-from-u-banks/06WAa_cPHp71OGxfxZj-rQ
"""good bank earnings reports but supported by very little disclosure, flies in the face of deteriorating credit quality, no real information on how they got to this 'earnings' number, can't put a floor under the housing problem until there is a floor under the unemployment problem, there is a danger to offering sweet deals (essentially full faith offerings) to Goldman Sachs, Wellstone, PIMCO, BlackRock, Blackstone, Bridgewater etc while expecting foreign countries to keep buying low interest treasuries.., basic problem is still dealing realistically with toxic assets.(which may need nationalization to get current management out of the way) """
It seems like the banks can come clean sooner or later... Either way will be bad for the stock market.. Later could seriously impinge on the administrations credibility.....
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