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The Incredibly Shrinking Market Liquidity, Or The Upcoming Black Swan Of Black Swans Posted by Tyler Durden at 3:40 PM "Anyone who is doing anything sensible right now is either losing money or is out of the market entirely." These are the words of a quant trader, who is seeing something scary in the capital markets. Scary enough to merit a warning that we could be on the verge of another October 87, August 2007, or January 2008. Let's back up. I recently posted a chart which tracks equity market neutral strategies: in essence a cross section of quant funds...

Depression: What We Can Learn From It Today," the Mises Circle in Colorado; sponsored by Limited Government Forum of Colorado Springs and hosted by the Ludwig von Mises Institute. Recorded Saturday, 4 April 2009.

TULSA, Oklahoma (Reuters) - The United States economy will skid more deeply into recession in coming months, Federal Reserve policy-makers warned on Thursday, but it is time to start planning how to wind down spending to avert an inflationary surge.

Liberal financier George Soros on the economy and the banking collapse. This is the same man who said last month that is is "having a very good crisis", as his hedge fund managers make billions off recession.

Just weeks after "The Daily Show" host Jon Stewart took Cramer to task for trying to turn finance reporting into a "game," famous bear economist Nouriel Roubini criticized Cramer on Tuesday for predicting bull markets. "Cramer is a buffoon," said Roubini, a New York University economics professor often called Dr. Doom.

The chief executive of financial bookmaker IG Group has called the recent stock market gains a "false rally" and predicted the FTSE 100 and Dow Jones will tumble almost 30pc. Tim Howkins said he expects there to be further gloomy economic news around the world, causing the blue-chip index to fall to as low as 2,800 and Wall Street's leading index to crash to 5,700. The FTSE 100 is now at 3898.8 and the Dow Jones is at 7810.2 "Those falls would be pretty apocalyptic from where the markets are now," he said. "But the world is getting worse rather...

Bernanke Inserts Gun In Mouth I'm not at all sure I believed what I read today.  (my comments in italics, indented) Information received since the Federal Open Market Committee met in January indicates that the economy continues to contract.  Job losses, declining equity and housing wealth, and tight credit conditions have weighed on consumer sentiment and spending.  Weaker sales prospects and difficulties in obtaining credit have led businesses to cut back on inventories and fixed investment.  U.S. exports have slumped as a number of major trading partners have also fallen into recession.  Although the near-term economic outlook is weak, the...

It is six months since Lehman fell and the crash (or the great recession, or the collapse—it's time it got its name) began. An aspect of the story given less attention than it is due, perhaps because it doesn't lend itself to statistics, is the psychic woe beneath the economic blow. There are two parts to this. One is that we have arrived at the first fatigue. The heart-pumping drama of last September is gone, replaced by the drip-drip-drip of pink slips, foreclosures and closed stores. We are tired. It doesn't feel like 1929, but 1930. People are in a...

This linked article kind of explains what I'm referring to. Doing some research last night, I stumbled across something quite interesting. Something I never knew existed, Central Bank Gold Agreement came up as a discussion about gold prices. Apparently, 15 mostly European nations signed a pact in 1999, then renewed the deal in 2004. This agreement limits the central banks of those countries ability to sell their gold reserves. Back in 1999 this was meant to stabilize the price of gold, which was unusually low. I personally find this very interesting, as a finance professional, because it is an artificial...

When the average American is told that the dollar has lost 95% of its purchasing power since the inception of the Federal Reserve in 1913, he looks at you with a blank stare and start wondering whether American Idol is on TV tonight.

This is a radio program interview of a guest, Gary Kah. The blurb on the webpage says -- "March 7, 2009 - Hour 1 - Gary Kah returns for an update on the push for global government, the current set up for the antichrist, more econony-related issues, and much more." Apparently Europe has given Obama a 100-day *Ultimatum* for the U.S. to come *under* a "world financial system" -- "or else". Apparently they will stop buying our debt and that would cause a CRASH bigger than the one that we have already had. The *bottom will drop out* -- if...

The Market Kills The Bezzle It appears that Mr. Market is singularly unimpressed with the unemployment situation, which is actually showing a slowing in the rate of change in U-6, which is in fact positive. However, "The Bezzle" remains unaddressed by government, and therefore, irrespective of anything else, the market will sell off. The Nasdaq is down more than 2% at this point, and here's the chart of today's /ES thus far: This will not stop until "The Bezzle" comes out. One way or another, it will come out. That's more than a 3% move downward today in the first...

CalPERS: Thinking the unthinkable By Ed Mendel Last spring CalPERS doubled the amount of a program that uses the pension fund’s gold-plated credit rating to help state and local governments borrow more cheaply, moving the cap from $5 billion to $10 billion. Now as the economy crumbles, CalPERS is taking a look at what seemed unimaginable last year: What happens if the government borrowers default on their debts and CalPERS has to repay the loans? “In exchange for only a couple million dollars you are taking on a heckuva a tail risk,” Michael Schlachter of Wilshire Consulting told the CalPERS...

Preview from Europe: Stocks Go Cliff Diving Again by: The Mole March 06, 2009 It's amazing what you can buy for a buck or two these days. The un-happy meal menu of stocks features Citibank (C) at $1.02 and General Motors (GM) at $1.86 as the death spiral beckons. There are times when too much drink is simply not enough as the horror show continues unabated. Yesterday’s laughable notion that the Chinese authorities are in control of events and would be able to turn their export driven economy around displayed the kind of naivte and misplaced optimism not seen since...

More GE (IMPORTANT) Off the wires, no link. "DJ reports GE Capital credit default swaps worsen even as GE released a statement emphasizing its strong cash position. The CDS are most recently quoted at 17.5 points up front, from 16.5 points up front earlier today, according to Phoenix Partners Group. That means investors must pay $1.75 mln up front, plus a $500,000 annual fee, to protect $10 mln of GECC senior bonds against default for five years." That means the first year cost is $1.75 + $500k, or $2.25 million. That's 22.5% first year cost to insure $10 million against...

http://www.vanityfair.com/politics/features/2009/04/iceland200904Cannot post Vanity Fair material at Free RepublicIceland was run like a hedge fund. They looked at Wall Street and said "We can do this" Iceland was ranked number one in 2008 by the United Nations’ Human Development IndexIcelanders are supposed to be cool and rational so what went wrong?For smart Icelanders the economics of financial engineering took over the economics of fishing which had served Iceland wellhttp://www.vanityfair.com/politics/features/2009/04/iceland200904Protesters in Reykjavik, some holding signs reading Stop The Corruption, are seen outside the parliament building during a demonstration Saturday by several thousand people against Iceland's economic meltdown.

The stock market is crashing—slowly, and in plain view of the people who count on it most. The 53% plunge in the Dow Jones industrials since October 2007 has wrecked the college- and retirement-savings plans of millions of investors. It has permanently lowered the long-term investment projections of private endowments and pension funds. It has sent corporate compensation experts scrambling to figure out how to reward top employees. All told, more than $10 trillion of stock market wealth has vanished, and with it the confidence that springs from financial security. While 17 months may feel like an eternity, it could...

This is the most brutal downturn in decades, but the unemployment numbers only show part of the pain. NEW YORK (CNNMoney.com) -- It's no secret that the job market is bad. The Labor Department will release its latest jobs report Friday. Economists surveyed by Briefing.com forecast that the unemployment rate rose to 7.9% in February and that 650,000 jobs were lost. Still, as bad as those numbers are, some have argued that this jobs downturn is not as bad as the early 1980s. The unemployment rate peaked at 10.8% in late 1982. But several experts say it would be a...

U.S. stock futures signal no follow through By Steve Goldstein, MarketWatch Last update: 5:49 a.m. EST March 5, 2009 LONDON (MarketWatch) -- U.S. stock futures failed to extend gains Thursday following a rare up day, with disappointment over a lack of new Chinese spending dampening sentiment. S&P 500 futures (SPY SPDR S&P 500 ETF News , chart , profile , more Delayed quote data Add to portfolio Analyst Create alert Insider Discuss Financials Sponsored by: SPY) slipped 7.3 points to 701.10 and Nasdaq 100 futures (QQQQ PowerShares QQQ News , chart , profile , more Delayed quote data Add to...

The U.S. Financial System Is Effectively Insolvent Nouriel Roubini 03.05.09, 12:01 AM ET For those who argue that the rate of growth of economic activity is turning positive--that economies are contracting but at a slower rate than in the fourth quarter of 2008--the latest data don't confirm this relative optimism. In 2008's fourth quarter, gross domestic product fell by about 6% in the U.S., 6% in the euro zone, 8% in Germany, 12% in Japan, 16% in Singapore and 20% in South Korea. So things are even more awful in Europe and Asia than in the U.S. There is, in...