‘Near Death’ Cash Hoards & Debt Deflation

November 2nd, 2009 by stacyherbert

Stacy Summary: Morning.

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10 responses so far ↓

  • Mike2liverpool
    Nov 2, 2009 at 2:36 am

    So, another week……..i see the BOE is “Thinking” about more QE!
    Mike

  • Ptah
    Nov 2, 2009 at 3:01 am

    Do Citi and JP really have cash to hoard or do they want us to think they have cash whilst they continue to launder their debts slowly trying not to deflate the market so as to allow it to run outside of their control… like China is doing with its dollar holdings but from inside the dollar zone?

  • Mep
    Nov 2, 2009 at 3:27 am

    Interesting theory: Robert Shiller suggests that visible signs of “recovery” has been partly made possible by stimulus, but also public confidence that the new administration was actually working to fix the crisis:

    http://www.huffingtonpost.com/2009/11/02/robert-shiller-address-in_n_341828.html

    Recent consumer info. would suggest that the confidence bubble is deflating.

  • frances snoot
    Nov 2, 2009 at 5:30 am

    G20 communique:

    “Building high quality capital and mitigating pro- cyclicality: We commit to developing by end-2010 internationally agreed rules to improve both the quantity and quality of bank capital and to discourage excessive leverage. These rules will be phased in as financial conditions improve and economic recovery is assured, with the aim of implementation by end-2012. The national implementation of higher level and better quality capital requirements, counter-cyclical capital buffers, higher capital requirements for risky products and off- balance sheet activities, as elements of the Basel II Capital Framework, together with strengthened liquidity risk requirements and forward-looking provisioning, will reduce incentives for banks to take excessive risks and create a financial system better prepared to withstand adverse shocks. We welcome the key measures recently agreed by the oversight body of the Basel Committee to strengthen the supervision and regulation of the banking sector. We support the introduction of a leverage ratio as a supplementary measure to the Basel II risk-based framework with a view to migrating to a Pillar 1 treatment based on appropriate review and calibration. To ensure comparability, the details of the leverage ratio will be harmonized internationally, fully adjusting for differences in accounting. All major G-20 financial centers commit to have adopted the Basel II Capital Framework by 2011.”

    http://www.bloomberg.com/apps/news?pid=20601087&sid=auIe3UTJncpY

  • Dante
    Nov 2, 2009 at 5:48 am

    What deflation look at these salaries:
    meanwhile, students have to hock their kidneys to pay off student loans.

    Rensselaer’s Jackson Highest Paid College President, Study Says
    Rensselaer, in Troy, New York, paid Jackson $1.6 million in salary and benefits in the year ending June 30, 2008, according to a survey released today by the Chronicle of Higher Education. Columbia University, in New York, paid Lee Bollinger $1.38 million. Bollinger, in sixth place, was the best paid president to lead one of the eight schools in the Ivy League.

    Presidential compensation rose 6.5 percent to a median of $358,746 in fiscal 2008, according to the survey of tax data from 419 nonprofit institutions. That growth outstripped the 4.8 percent rise in the consumer price index. Median pay at the 32 biggest research universities grew 16 percent, the Washington- based Chronicle said. Some of Jackson’s compensation included deferred bonuses and other benefits, reflecting increased complexity in the pay packages, said Jeffrey Selingo, the editor.

    http://www.bloomberg.com/apps/news?pid=20601087&sid=aRnEvMyqRoFw&pos=9

  • Photoception
    Nov 2, 2009 at 8:14 am

    I think its pretty obvious that we’re on the brink of a true liquidity crisis.

  • Matt Smyth
    Nov 2, 2009 at 6:01 pm

    Who is bullish on the dollar during a market crash ? Everyone ?

    During a potential market crash, it is actually a contrarien play to be bearish on the dollar, not bullish.