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The CBO Prefers a Carbon Tax to Cap-and-Trade

Posted on February 13, 2008 by Felix

I’m a supporter of a cap-and-trade system over a carbon tax. But I have to say that Terry Dinan, of CBO’s Microeconomic Studies Division, has the best argument in favor of a carbon tax over cap-and-trade that I’ve yet seen. … Continue reading →

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Credit Suisse: Not a Team Player, but Profitable

Posted on February 12, 2008 by Felix

Credit Suisse reported reasonably good results, by bank standards and especially by UBS standards, this morning. But its reputation in the loan markets is taking a beating in the wake of the behavior detailed by Heidi Moore yesterday. Every time … Continue reading →

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AIG’s Arbitrary Write-Down

Posted on February 11, 2008 by Felix

The news seems to be reasonably clear: according to an 8-K it filed today, AIG has suddenly discovered that the value of its credit default swaps is $4.88 billion lower than it had previously indicated. That’s Bloomberg’s number, and the … Continue reading →

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Wolfers on New Hampshire and Clemens

Posted on February 11, 2008 by Felix

I had a long conversation about prediction markets and data-crunching with Justin Wolfers at the Money:Tech conference last week, which continued over the weekend via email. Given that we’re both bloggers, it seems time to bring the debate out into … Continue reading →

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FT Alphaville’s Secret RSS Feed Revealed

Posted on February 6, 2008 by Felix

FT Alphaville has a full RSS feed! It’s top-secret, and available only to Market Movers readers; it can be found here. My plan for world domination is coming along nicely: the only last holdout now is the NYT. Sorkin, get … Continue reading →

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Goldman Gets Downgraded

Posted on February 5, 2008 by Felix

Has Goldman Sachs run out of special sauce? According to Meredith Whitney of Oppenheimer, yes:. In 2008, she says, "Goldman Sachs will probably deliver results that will not be substantially better than its peers," and as a result she’s downgraded … Continue reading →

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House Prices: The Best and Worst US Cities

Posted on January 30, 2008 by Felix

Justin Fox has another of his very pretty charts today, showing the evolution of house prices in 20 different cities between January 2005 and November 2007. Let’s say I allowed you to go back in time to January 2005 and … Continue reading →

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Boris Nurdbongleur Dodges the Credit Crunch

Posted on January 29, 2008 by Felix

Tim Price: Speaking on condition of anonymity, Marti Peeps, a spokesman for the bank, admitted that he was gloomy on prospects for the sector, notwithstanding Societe Bancaire de Neasden’s surprise results. “This has come in the wake of other debacles … Continue reading →

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Musharraf on the Islamic Bomb

Posted on January 24, 2008 by Felix

Pervez Musharraf, speaking at Davos, is a bit peevish: We are a nuclear state. Why does the world insist on calling this an Islamic bomb? There is no Hindu bomb or Jew bomb or Buddhist Bomb or Christian Bomb. This … Continue reading →

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Ken Lewis’s Call Option on Countrywide

Posted on January 18, 2008 by Felix

The most recent deal not going according to the merger-arb playbook is Bank of America’s acquisition of Countrywide. The takeover takeunder is valued at $6.47 per share, but Countrywide is trading at only $5.11. How come? Well, have a look … Continue reading →

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Inflation Expectations: Coming Down

Posted on January 16, 2008 by Felix

Back at the beginning of the year, I recommended putting in a non-competitive bid for 10-year TIPS at the January auction on January 10. Now that’s happened, I can link to the results: my hypothetical bid would have picked up … Continue reading →

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Was New Hampshire a Truly Historic Result?

Posted on January 9, 2008 by Felix

Justin Wolfers is unapologetic in the wake of Hillary Clinton winning the New Hampshire primary. Clinton’s victory, he says, was "one of the most surprising upsets in U.S. political history": Election-eve trading had suggested that Sen. Obama had a 92% … Continue reading →

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Extra Credit, Weekend Edition

Posted on January 5, 2008 by Felix

E*Trade figure does not compute… New Type of Analysis on the Iowa Results: How the big Republican winners in Iowa were McCain and Giuliani more than Hucakbee. But: Are Political Markets Really Superior to Polls as Election Predictors? A link … Continue reading →

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Extra Credit, Friday Edition

Posted on January 4, 2008 by Felix

Performance measurement and the challenge of active management: A basic hurdle any active investor should be able to clear. Milan introduces traffic charge: A €10 congestion charge to enter the city center, but you can get around it by installing … Continue reading →

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Uncovering Material Information at Merrill Lynch

Posted on December 27, 2007 by Felix

It’s the bottomless write-downs! According to William Tanona of Goldman Sachs, the write-downs we’ve already seen at Citigroup and Merrill Lynch aren’t even close to being final. Indeed, he reckons that both banks will see 11-figure write-downs in the fourth … Continue reading →

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Morgan Stanley: Eminently Stoppable

Posted on December 19, 2007 by Felix

Morgan Stanley’s Q3 earnings were bad. "Mack Smacked" was the Portfolio headline, reacting to a lower profit (just $1.54 billion, John Mack’s first quarterly earnings decline) and a nasty $940 million write-down on bad loans. Ah, those were the days. … Continue reading →

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What do US Consumers Have to Fall Back On?

Posted on December 14, 2007 by Felix

Even as the economy has been growing over the couple of decades, people have been feeling increasingly insecure, perhaps because they have less and less to fall back on. Lane Kenworthy puts it well: Households now appear to be more … Continue reading →

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The Wolfowitz Ouster, Redux

Posted on December 13, 2007 by Felix

Fox News journalist James Rosen has a long and largely sympathetic account of Paul Wolfowitz’s ouster from the World Bank in the November issue of Playboy. At the beginning of the piece he’s unambiguous: What happened to Wolfowitz was more … Continue reading →

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Chandelier Bidding in Padua

Posted on November 30, 2007 by Felix

The New Yorker’s Mary Norris went to Padua for an auction run by Coys of Kensington, auctioneers of vintage motorcars. She accompanied Giuseppe Favia, who was selling a 1959 Mercedes-Benz 190 D with literally sainted provenance. The auction itself, however, … Continue reading →

Posted in art | 1 Comment

Pinot Contest

Posted on November 18, 2007 by Felix

Last night, a dozen or so friends and I discovered one of the best-value wines in America. I’ll tell you what it is in a minute. But first, it’s worth explaining how we came to that conclusion: Michelle and I … Continue reading →

Posted in Not economics | 12 Comments

Unsecured Personal Debt: The Next Shoe to Drop?

Posted on November 14, 2007 by Felix

HSBC has been one of the biggest subprime lenders in the US ever since it bought Household International for $15.5 billion in 2003. It was one of the first major banks to take big subprime-related losses, too, and it doesn’t … Continue reading →

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When Athletes IPO

Posted on November 12, 2007 by Felix

Remember the jock exchange that Michael Lewis wrote about in the first issue of Portfolio? The idea was that an exchange could be set up where the assets traded were not shares in companies but rather shares in athletes. Well, … Continue reading →

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Mark-to-Model on Wall Street: The Numbers

Posted on November 6, 2007 by Felix

Nouriel Roubini hoists a nice piece of detective work from his comments: Bernard has gone down the list of Wall Street banks, looking at how much they have in the way of level 3 ("mark to model") assets, compared to … Continue reading →

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Merrill’s Board: Asleep at the Wheel

Posted on November 1, 2007 by Felix

With Stan O’Neal out the door, whither the board which supported all of his decisions? Peter Eavis has a good point today: Merrill Lynch’s board is arguably just as culpable for the firm’s atrocious results as the erstwhile CEO was. … Continue reading →

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Finding a New Merrill CEO

Posted on October 31, 2007 by Felix

As John Carney notes, it’s a little bit weird that Merrill Lynch is now headless – and just as the all-important bonus decisions are being made, too. Why no interim CEO? Carney speculates that no one is willing to do … Continue reading →

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