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Tag Archives: S&P

The market is rigged? No : ‘Plunge protection’ behind market’s sudden recovery

The “plunge protection team” (PPT) used to be something which was whispered about. Now it’s openly discussed in the New York Post. Hell will become a frost covered plain before the New York Times  will ever mention the PPT of course.

As I have written before, there is an understanding among traders post-2008. If the market heads into a nose dive the Fed will intervene. It will actively buy futures (and likely whatever else it has to) in the market to buoy the market.

The PPT is kind of like the Israeli nuclear program. No one acknowledges it officially but almost everyone thinks it exists and as such this impacts markets.

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The Hill: Another financial meltdown on the horizon?

We have been “pressing the case for sound money” for a very long time. Many others, particularly those economists considered part of the Austrian School have been doing so for decades. It was the Austrian School economists who saw 2008 coming. It was the Austrians who warned the world. But the Austrians are a truly and deeply free market bunch, and politicians don’t like free markets. So the warnings went unheeded.

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S&P slaps junk bond rating on Tesla debt

We are all for innovation. We are all for non-gasoline vehicles which are ready for the market. The Toyota Prius is a great example of a car which makes sense from a business perspective.

Tesla is not as clear cut. I’ve looked at the Tesla S first hand and it is an impressive auto. 0-60 in 4 seconds with no gear shifts is pretty cool. The price relative to other cars with similar levels of performance is competitive.

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10 peaking megabubbles signal impending stock crash (?)

It’s been an interesting if not fun ride up in the markets. Through a 6-year economic slowdown stock markets have rallied and rallied and rallied. Everyone assumes that the Fed is backstopping the market, that it has to for political reasons. So people have piled in even though earnings and economic indicators have been generally lackluster. Sounds almost like “house prices never go down.”

But not quite.

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Geithner met with Obama just before warning S&P that the debt downgrade by the company would be met with a “response” from Washington

In January Bloomberg reported that Tim Geithner called the CEO of Standard and Poor’s after the company downgraded US debt to explain that the move would have “ramifications” for the company. Now S&P finds itself embroiled in a lawsuit driven by the Justice Department which S&P says is punishment for the downgrade. Read More

Are we looking at a “global deflationary shock” triggered by the Fed?

The economic tide has been going out for quite a while, but the pace has just quickened in emerging markets – big time. Things have become quite unsteady and no one knows whether the current instability will trigger something broader in the developed economies. China is slowing. Japan has horns locked with China economically and increasingly politically. Europe is catching its breath before another wave rolls through.

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