MB, one of the things that Soros goes into in his recent book (which I have skimmed, but not read yet because he is insane and as a result a bit hard to read) is the derivative exposure of banks. Of course he thinks it is huge risk for banks away from the peripheral problem countries. I've heard a lot about this issue but would be interested in your opinion as to the risks banks face in the next few years, how its going to show up on the balance sheets, etc. TIA.
Oh yeah, this note to which I'm responding discusses the risks of inflation on financial assets. Ken Fisher (the Forbes columnist), who I used to like but currently find as annoying as Laszlo Birinyi (who I recently noticed upon rereading Liars' Poker is totally excoriated in that book), goes on in his most recent article about how in his opinion the market would go up until 2001 because Clinton would pressure G-Span to provide easy money to the economy to help ensure Gore's election. Also, it seems that a lot of the new governors coming in are of the easy money variety (I don't understand the process 100%, but am under the impression that the Prez nominates the gov's of the fed, and the gov's are then approved by congress). I don't see a scenario where the Fed can ease and still avoid inflationary pressures, but would appreciate any insights you might have in this regard. TIAAgain. |
