Off Again On Again: Repeat after me: "QSPEs". It stands for Qualified Special-Purpose Entities. Those are the 'off book' little deals - about $5 trillion of them - where banks hide things they don't want to tell their shareholders or the government about. Like the sub-prime derivatives that were off-book because they were 'contained' and all. The FASB has eliminated the concept of QSPEs. Even if this does not tarnish banks' images even more, it is certain to limit their ability to write new loans. In our debt-driven economy, this is not a Good Thing.
Tranquility : Don't worry about Peak Oil, Peak Water, or even Peak Food. Worry about the valley that lies beyond the peaks.
Free Money, Please Big housebuilders want Congress to give them $15,000 for each house they build. Of course it has to be hidden as a tax credit to new home buyers, but the money will go straight from the US treasury to the homebuilders. "Let's see if we can con some folks into buying our overpriced...
Death Row: The only hope monoline bond insurers MBIA and Ambac have is a last minute phone call from the governor's office.
What Are Friends For: Saudi Arabia is changing the price of light sweet crude shipped to the US from $1.45 per barrel under the WTI benchmark to $2.40 over the benchmark.
Dividend Yield: Over 30 major US companies pay out more in dividends than their cash flow will support. Mortorola, for example paid a dollar a share while generating 8 cents in free cash flow. It's the Bush stimulus plan: borrow to bribe.
It's A Gas, Naturally: Analysts are predicting a steep natural gas price rise this summer which will lead to a steeper increase in electricity prices in the Northeast - where much of the power is from gas-fired generators. The forward price for natural gas for the summer months is 75% above last year.
Negotiating Point: The Middle East supplies 22% of US oil, 40% of China's, 60% of India's and 80% of Japan's. The economic well-being of 95% of the world relies on decisions made by five or six countries in the Middle East. Think they don't know this?
More? How? Nearly a billion people have been going hungry for many years - but they live in rural areas. Let 500 million people in the towns go hungry and governments take notice. Or they are not governments very long. To pretend the world is going to produce 50% more food in 20 years is to pretend.
After You , Alphonse : Showing far more manners than one expects from greedy, over-reaching bankers, British bank Bradford & Bingley seems determined to let Lehman go under first, while Wachovia and Washington Mutual have got their knees pressed tighly together waiting for someone else - anyone else - to go first.