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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ild who wrote (30371)	4/11/2005 11:56:35 AM
From: mishedlo	Read Replies (1) \| Respond to of 110194

Brian Reynolds reported something like a 50 bps selloff in Ford debt. That is a pretty steep drop Mish

To: ild who wrote (30371)	4/11/2005 12:25:28 PM
From: Roads End	Read Replies (1) \| Respond to of 110194

WRT Ford, I didn't think the dead fish could get any more dead but look at this new opinion released today. UFB 11-Apr-05 Thomas Weisel Downgrade From Outperform To Peer Perform , "Peer Perform" ROTFLMAO, last I checked Honda and Toyota were peers.

To: ild who wrote (30371)	4/11/2005 1:38:54 PM
From: Knighty Tin	Respond to of 110194

All I've got is that the spread to Treasuries increased by 35 basis points today, 97 basis points for the past week.

To: ild who wrote (30371)	4/11/2005 1:58:01 PM
From: ild	Respond to of 110194

Date: Mon Apr 11 2005 11:52 trotsky (Bleuler, 10:11) ID#248269: Copyright © 2002 trotsky/Kitco Inc. All rights reserved "Last summer, one-third of economists who participated in The Wall Street Journal Online's economic forecasting survey said a recession would follow if crude-oil stuck between $50 and $59 a barrel — exactly where futures prices have traded since late February. But the economy isn't in peril today. In the latest forecasting survey, none of the economists feel that $50 oil will trigger a recession. About 31% said oil would have to be sustained at $80-$89 a barrel to snuff out growth, while 48% believe crude would have to top $90." the fact that NONE of the polled economists now believe that high oil prices will trigger a recession is what is referred to in the markets as the 'ringing of the bell'. it's practically a guarantee that a recession will be triggered, and in hindsight be blamed on high oil prices. i'm continually amazed at the lack of quality of mainstream economic analysis...but Mr. Fekete has recently cleared a few things up for me by pointing out that a whole lot of economic research is funded by grants from the unlimited war chest of the Fed, which explains the prevailing 'don't rock the boat' attitude that informs most of this research. one of the most glaring failings of mainstream analysis is that it is extremely short term oriented - just because $50 oil hasn't led to a recession YET, it is believed it never will. but this completely ignores the lead-lag factors operating in the economy. in the past, recessions triggered by high oil prices invariably coincided with falling oil prices - in short, high oil prices have always LED the recessions. it is also noteworthy in this context that there has not been a single post WW2 instance of oil prices rising to the same extent as they have over the past two years when a recession has NOT followed in the wake of the oil price increase. the 'new-pair-of-dime' philosophy espoused by economists TODAY requires us to believe that the sharply rising price of THE most important raw material input cost item has no effect on the economy. this is patently nonsense ( and every housewife could tell you that, we sure don't need economists to be aware of this common-sense basic fact ) . it is not relevant that the economy appears not to be in peril TODAY. it is the future that needs to be considered, and the lag time with which both rising oil prices and rising interest rates are felt in terms of economic activity. the FF rate has e.g. risen by 175% from its lows - and still the prevalent belief is that this has no effect on the economy, because it is 'still low' ( just as with oil, the 'inflation adjusted price' canard is used to buttress claims that its price 'does not matter' ) . however, if one looks back at past comparable instances, one notices that the relevant datum has always been the size and the speed of the move - relative from whence it started, and NOT the absolute levels that are attained. so economists know enough about data mining to quote 'inflation adjusted' oil prices, but they don't go data mining to check if their conclusions are actually valid. Date: Mon Apr 11 2005 11:21 trotsky (Glooscap, 10:04) ID#248269: Copyright © 2002 trotsky/Kitco Inc. All rights reserved from the article you posted: "We can expect tax reform, fiscal discipline, deregulation, free capital flows, lowered tariffs, reduced public services, and privatization." bwahaha...if only that were true, we could all rest easy. however, in case of a sharp economic downturn, none of those things should be expected, even though they would be the only sensible route to follow. instead we will get EXACTLY what the author wrongly believes we won't get, namely more socialism in all its forms, as in increased regulation, fiscal profligacy on an unprecedented scale, inhibition of capital flows, more calls for tariffs ( just as in the 30's ) , and nationalization, as big firms in trouble get taken over by the state in tax payer bail-outs. now, the author of the article seems to be laboring under the illusion that the current administration does somehow not stand for such things. but this is only a superficial impression, not at all confirmed by what has so far happened. he also seems to think that if only we followed the road to more state control , higher taxes, higher tariffs, and so on, everything would then be a-ok. the ravings of a delusional mind in short. when such prescriptions are followed to their logical conclusion, you end up with something akin to the former Soviet Union. THAT one sure worked well...