Saturday, May 16, 2009

Added Yield Curve

Added the official Treasury Yield Curve rates page to list of links.

Friday, May 15, 2009

China's Yuan to usurp dollar

According to professor Nouriel Roubini, China is taking steps to allow the yuan to ascend to the world's reserve currency.

Monday, May 11, 2009

Added Chicago Fed National Activity Index (CFNAI)

This aggregate was suggested by an insightful comment on the Calculated Risk blog. From the Chicago Fed web site:
The CFNAI is a weighted average of 85 existing monthly indicators of national economic activity. It is constructed to have an average value of zero and a standard deviation of one.
It appears to have been a fairly accurate indicator of past recessions and the current one. Worth a look.

Sunday, May 10, 2009

Dow/Gold ratio, which way next?

Barry Ritholz has an interesting post and graph of the Dow/Gold ratio sing 1980 when it hit a low of 1.5. I don't expect the bear market to end until it at least touches 5 again. In that case, we've got a ways to go.

Tuesday, May 5, 2009

Chrysler Bankruptcy

We are only a few days into the Chrysler BK and things already looked muddled. The Detroit Free Press has an interesting article on the proceedings and the immediate road blocks thrown up by some creditors.

The U.S. Treasury wants to loan Chrysler $3.34 billion and the Canadian government $1.16 billion of the in-court financing.

He also said there was a "low probability" that Chrysler would be able to repay that loan. That means the U.S. Treasury could end up losing nearly $8 billion in loans issued to Chrysler -- including the $4 billion loaned in January.

So, the taxpayers are already eating about $8 billion right out of the gate.

"The survival of Chrysler's business is at stake in these proceedings, as is the fate of hundreds of suppliers and thousands of Chrysler dealers around the country," Chrysler's lead bankruptcy attorney, Corinne Ball, said in a court filing Sunday. "Absent immediate action, (Chrysler) will lose the only opportunity available to them to preserve their business as a going concern and to avoid the economic devastation that will occur if Chrysler's business, and Chrysler's suppliers and dealers, are forced to shut down."

As bad as the initial $8 billion loss is, there is a small possibility that Chrysler could end up in liquidation. That would create untold chaos. Even if they emerge in partnership with Fiat, it looks their prospects are weak for surviving more than a couple of years. Ugly.