Investors avidly awaiting signs that the Federal Reserve is ready to reduce its monthly stimulus may find that the news already has passed them by.» Read More
Calling for home prices to fall further probably won't win Vernon Smith a lot of friends. But that isn't stopping him.
"I am just amazed how consistent housing is at the forefront of recoveries, which is also assisted by durable good expenditures," said Vernon Smith, winner of the 2002 Nobel Memorial Prize in Economic Sciences (with Daniel Kahneman) and professor of economics at Chapman University's Argyros School of Business and Economics and School of Law in Orange, California.
"I consider housing the most durable good of all. Going back to the Great Depression, you can see house expenditures started to go down in 1926 and they were down substantially by the time the stock market crashed in 1929 and I think that tells you why the banks were in trouble.
The banks were in trouble because of a balance sheet problem. Really bad recessions are essentially balance sheet crunches. The value of bank mortgage portfolio assets is all of a sudden down substantially and you not only have households under water but you also have banks under water."
Equities rally despite lower than expected durable goods and home sale numbers. (Wall Street Journal) As capital flees the safe haven of bonds, yields rise.
I have caught myself sounding like a broken record recently, listing all the records that we are setting in the markets.
Let's go for broke: Gold and silver have set new records. The Chinese yuan has set a post-revaluation record high, the Swiss franc and the Singapore dollar have reached a record against the greenback, Indonesia's stock market is at an all-time record high, Brazil's Petrobras set a global record for a share sale.... and the first prize list could go on.
Mort Zuckerman's latest US News & World Report column analyzes what went wrong in the housing market.
For the baby boomer generation, a home is now seen not as the cornerstone of advancement but a ball and chain, Zuckerman writes.
And he brings a boatload of statistics to the table to back it up.
Here are some of the grim numbers:
"I mean, no one was being held with a gun to their head and forced to work at Morgan Stanley." So begins Leon Neyfakh's article in the New York Observer on the tech life on Wall Street.
Smart tech guys live to work on complicated technical problems — and are often motivated to take jobs by a desire innovate and build intellectually satisfying solutions as much as for the money. Many are sold on an employer on the basis of its street cred as a "hacker-oriented shop"
But after a while on Wall Street, disillusionment can set in.
Goldman Sachs may be losing some of its proprietary traders thanks to Volcker rule restrictions on betting the firm's own capital. But the firm is hardly getting out of trading.
In fact, Goldman has recently given mandates to recruiters to seek out quants for its trading operations in both its Quantitative Investment Strategies group and its high frequency trading operations.
These are high-level positions. The QIS job requires a PhD and at least three years of experience in finance. It involves doing quantitative portfolio research for Goldman’s Algorithmic trading desk, which trades currencies, futures and equities. Basically, these are the guys that program the squid’s tentacles.
The other quant position is at Goldman’s designated market-marker arm at the New York Stock Exchange. This is the gang that runs the high-frequency trading ops of Goldman.
Investing in gold has been one of the best ideas of the past couple of years.
Gold December futurespassed $1300 for the first time. The potential for dollar-weakening further Fed easing is likely a driver behind the continued rise. If the economy continues to weaken, the Fed may push more dollars into the economy by purchasing more debt securities. This could hurt the dollar, and lead to a rise in the price of gold.
Which is why a smart hedge fund manager would start shorting gold.
Let me explain right away that this is not a prediction about the direction of the price of gold. I suspect that the tendency of a deficit spending government concerned with high unemployment will be to debase the dollar, which implies a nominal rise in the price of gold. Bernanke is a believer in the power of inflationary policy to spur the economy. Fundamentally, this should be a bullish analysis for gold.
It is no shocker that the Senate delayed its vote on extending the Bush Tax Cuts till after the election.
But this delay is just adding to the uncertainty hanging over the U.S. economy. Our great country is sick. She's bloated from drinking too much from the debt well and we have politicians on both sides of the aisle fighting like children and pushing back the inevitable vote.
While this finger pointing, "I'm rubber, you're glue" game is played on Capitol Hill, there are new taxes coming down the pike next year that will impact Middle America, the very taxpayers that President Obama says he wants help.
Pete Sepp, Executive Vice President of the National Taxpayers Union \(NTU\) tells me while the focus is on the 2001 and 2003 tax cuts, there are new tax problems looming for the middle class.
Federal government will sell low percentage of G.M. stock in order to fetch highest price. (New York Times) Analysts seem to find consensus that it will take years for gov’t to recoup its $43 billion investment.
John Carney is a senior editor for CNBC.com, covering Wall Street and finance and running the NetNet blog.
Jeff Cox is finance editor for CNBC.com.
Lawrence Delevingne is the ‘Big Money’ enterprise reporter for CNBC.com and NetNet.
Stephanie Landsman is one of the producers of CNBC's 5pm ET show "Fast Money."
The unofficial odds are rising that the Fed will announce taper plans at its December meeting.
Three Wall Street trade groups sued the Commodities Futures Trading Commission to stop tough overseas trading guidelines they fear.
Paid in the form of assistance programs, the funds are in effect a subsidy to the banking industry, The Washington Post reported.