Empiric Student Property Share Discussion Threads

[briarberry] 11/6/2010 21:04

Japan is at "risk of collapse" under its huge debt mountain, the country's new prime minister has said.

Naoto Kan, in his first major speech since taking over, said Japan needed a financial restructuring to avert a Greece-style crisis.

"Our country's outstanding public debt is huge... our public finances have become the worst of any developed country," he said.

After years of borrowing, Japan's debt is twice its gross domestic product.

[briarberry] 09/6/2010 11:24

Spain 5-Year Credit Default Swap

June2010


February2010

[briarberry] 04/6/2010 15:43

Nonfarm Payrolls - M/M change +430,000

subtract this
But the real focus of traders is private payrolls to discount the impact of temporary Census hiring. According to the BLS, Census hiring added 411,000 temporary jobs to the payroll gain

subtract this too...
2010 Net Birth/Death Adjustment, not seasonally adjusted 215,000

[briarberry] 19/5/2010 14:42

MBA Purchase Applications

The expiration of second-round housing stimulus pulled sales into March and April at the very heavy expense of May. The Mortgage Bankers Association's purchase index plunged 27.1 percent in the May 14 week on top of the 9.5 percent plunge in the May 7 week to pull the index to its lowest level since 1997.

[briarberry] 18/5/2010 03:11

Foreign holders of Greek and Portuguese debt have seized on emergency intervention by the European Central Bank to exit their positions, leaving eurozone taxpayers exposed to the credit risk.

The Bank of New Mellon said its custodial data showed a "sharp acceleration" of net sales of debt from the two countries after the ECB began purchasing €16.5bn of bonds from southern Europe and Ireland in bid to halt market panic. "It rather suggests that investors leapt at the opportunity to clear their balance sheets of intolerable risk," said Neil Mellor, the bank's currency strategist. "This leaves the ECB itself in an unpleasant situation since it now faces a deterioration in its own balance sheet."

[briarberry] 18/5/2010 00:58

Zero% rates feed the bailout/stimulus bubble (link stolen from the gold fred)

Because the US government is lending money to the big banks at near-zero interest rates. And the banks are then turning around and lending that money back to the US government at 3%-4% interest rates, making 3%+ on the spread. What's more, the banks are leveraging this trade, borrowing at least $10 for every $1 of equity capital they have, to increase the size of their bets. Which means the banks can turn relatively small amounts of equity into huge profits--by borrowing from the taxpayer and then lending back to the taxpayer.

[briarberry] 17/5/2010 14:15

March foreign purchases of U.S. assets set record
Foreign Demand for Long-Term U.S. Securities = $140.5 Billion

March was the beginning of the Greek-sovereign debt debacle and what looks to have been the beginning of a giant surge in foreign demand for U.S. Treasuries. Foreign accounts bought a monthly record of net $140.5 billion in long-term U.S. securities, led by a net $108.4 billion for Treasuries

[briarberry] 13/5/2010 18:15

Canada's household debt hits new records, highest in OECD

Canada's household debt hit a new record of $1.41 trillion in December, with no signs the recession has altered consumers' willingness to borrow, creating warning signs for the economy, a survey found.

If the debt were spread across all Canadians, each person would owe $41,740, that's two and a half times more than two decades ago, the Certified General Accountants Association of Canada said.

The levels put Canada at the top of the 20 OECD nations in terms of debt-to-financial assets and puts their debt-to-income ratio at 144%, the survey found.

[briarberry] 12/5/2010 23:47

If you want a stock market rally just pump up IBM, one of the biggest market caps...

+4.5%

looks like it had an anti-glitch, a fat fingered buyer :) :)

[briarberry] 12/5/2010 23:41

Last Fridays Nonfarm Payrolls number must have been fantasy as individual tax receipts were poor in April

Nonfarm Payrolls - M/M change +290K

also subtract these:
CES Net Birth/Death Model Adjustment +188K
Census hiring 1.2 million people

Seven months into the government's fiscal year, individual tax receipts are down 11.6 percent and show erosion from an 8.4 percent decline in the March data.

(And they say that tax data cannot tell a lie ???)

[briarberry] 12/5/2010 19:20

It's going to be interesting to see where they get the money from....


U.S. April budget gap $83 bln vs $21 bln yr-ago (tax receipts down)

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On Monday, China reported a trade surplus of only $1.68 billion in April (so they will not need to buy foreign bonds)

ECB $Trillion bailout package is merely a commitment for the vehicle to borrow money

Bernanke: Fed will not monetize budget deficits

Fed purchases of $1.3T of MBS has ended

[briarberry] 11/5/2010 16:21

ECB bailout package - Americans seem to be saying that the Europeans should have just printed the money like the Fed did...



A Trillion for Europe, With Doubts Attached - New York Times

Indeed, for all the excitement about the scale of the effort, it is important to remember that the core fund does not now exist. The fund, known as a special purpose vehicle, would raise money by issuing debt and making loans to support ailing economies. The European countries would guarantee that fund.

So the package is merely a commitment for the vehicle to borrow money

...
The fund is therefore more a theoretical construct than the Troubled Asset Relief Program that was created in the United States, and that is where things get tricky.

By definition, if Spain (for example) came to a point where it could no longer finance itself, interest rates would be on the rise. The several hundred billion euros for the fund would not only come at a high cost, but would bring additional pain to already indebted countries like Portugal, France, Italy and the United Kingdom, which back the special purpose entity, thus compounding the region's debt woes.

...
In effect, Germany and other wealthier European countries are assuming responsibility for the creditworthiness of Greece, Portugal and the other debt delinquents.

[briarberry] 10/5/2010 16:00

Eurozone crisis is 'postponed'

Three important caveats however.

The actual loans and guarantees may turn out to be harder to deliver than the words of comfort from eurozone government heads.

Second, 750bn euros is just over one-year's new borrowing by eurozone members and a bit more than 10% of eurozone government debt. So it's certainly not enough if investors were to start to lose confidence in the ability of some big countries - such as Spain or Italy - to honour their debts.

Which takes us to the import third caveat. In the end, there won't be a cure for the underlying eurozone strains unless and until the record, unsustainable deficits of some eurozone members are reduced in a permanent way.




17. At 09:08am on 10 May 2010, mischievousCheesy101 wrote:
The 'meltdown' that is supposed to be imminent or at least unavoidable will not happen as long as the financial institutions believe one fundamental axiom. This is that if you plot tax revenues far enough into the future you can essentially call them infinite, therefore there is an infinite amount of capital available to bail out any nation or 'too big too fail' corporation. As long as this belief holds true, then really any debt is regarded as manageable. For those of you who believe this is an asinine assumption, tell me how it is that people in this country can supposedly afford to buy property that is valued at ten times their annual income or more? Because the debt is stretched out over so many years as to make the payment possible. Same thing with national debt, as long as the Chinese don't decide to dump all of their US Treasury Bonds the world can continue to rack up as much debt as it wants because there will always be taxpayers until the sun burns out..

[briarberry] 10/5/2010 14:07

Fannie Mae lost $13.1 billion in first quarter
Fannie says it asked Treasury for another $8.4 bln

[briarberry] 07/5/2010 20:40

German Parliament backs unpopular Greek bailout

Both houses of the German parliament on Friday approved emergency aid to Greece despite strong popular opposition two days before a state election that could seriously weaken Chancellor Angela Merkel's governing coalition.

[briarberry] 06/5/2010 20:37

Dow was down nearly 1000 points and the market was closed, reopening down 500 points...



The Dow plunged Thursday amid buzz in the market that European banks have halted lending.

One trader, on the condition of anonymity, said he heard fixed-income desks in Europe shut down early because there was no liquidity - basically European banks are halting lending right now.

"This is similar to what took place pre-Lehman Brothers," the trader said.



NYSE says it experienced no technical glitch during virtual free fall

Shares of Procter & Gamble Co. (PG 60.89, -1.27, -2.04%) briefly plunged 23% Thursday before just as suddenly cutting its losses to 2% for the session.

[briarberry] 04/5/2010 16:02

Greece will probably need another bailout in about 12 months, even if Greece does all the cuts...


BRUSSELS-The €110 billion ($147 billion) three-year Greek bailout by euro-zone countries and the International Monetary Fund won't be enough to cover Greece's costs, an examination of Greek financial figures shows, setting Europe up for more tough choices if private markets don't start lending again.

...
Counting the continued rolling-over of short-term debt, Goldman Sachs economist Erik Nielsen estimates Greece's needs at about €150 billion over three years. The sum of €110 billion has "taken the market out of the equation for at least 12 months," he says, but not three years

Greece will still need to borrow from the credit market in 2011

[briarberry] 04/5/2010 14:50

Plunge in state revenue dashes hopes of an easy budget fix

Revenue for April, the biggest revenue month because it is when most Californians pay their taxes, lagged projections by nearly 30% - roughly $3 billion, according to state officials. The drop was steep enough to erase improvements recorded in each of the four previous months.

[briarberry] 03/5/2010 20:10

$716bn next 6 months...

Treasury expects to borrow $340 bln this quarter
Treasury to borrow $376 bln July-Sept '10 quarter

[briarberry] 03/5/2010 00:33

The bailout/stimulus bubble is still growing...


Taxpayer Backing of Real Estate Mortgages At Staggering Level.

The Wall Street Journal Online reports this morning that the government's share of the U.S. mortgage market grew even larger in the first quarter. Government-related entities (the FHA, Fannie Mae, Freddie Mac, etc.) backed 96.5% of all home loans in the first quarter, up from 90% in 2009.