Opening Bell: 11.17.08

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Goldman Chiefs Forgo Bonuses (Reuters)
In the highest profile move of the sort thus far, we're seeing the heads of GS turn and cough. Here's the part that really irks the shit out of me:
"New York Attorney General Andrew Cuomo said Goldman had taken "an important step in the right direction.""
It takes a special kind of arrogance to stand up and tell men that have collectively given up ~3ooMM in personal pay that you approve, especially when done in such a thoroughly condescending I-know-better-than-you we're-all-proud-of-you-son paternal tone.
Genital Warts have more appeal.
Harftord To Become S&L, Seek Bailout (DJNW)
In a move that's becoming more popular as instability progresses, Harford is moving to acquire Federal Trust Corp., a thrift holding company established in Florida, and filing for S&L status.
The words "S&L" and "Bailout" have such a beautiful tone to them, I wonder why they aren't used in conjunction more often?
A Reminder Of Looming Palace Intrigue (CNBC)
Citi is going to be holding its Town Hall meeting this morning addressing the all popular topics "why we're so great", "and we kick ass" - just before they announce further layoffs. Granted, it probably won't be immediate, but I can imagine that embedded in the speech somewhere will be lines like "These are tough times, and tough decisions are required to pull this company that we all love through them."
Convertible Bond Funds Not Having A Good Year (WSJ)
The Culprit:
"But for a strategy that uses leverage to exploit often small market inefficiencies, one of the biggest problems has been banks reducing leverage and insisting on more capital upfront."
ABCPMMMFLF: Actually A Federal Acronym (Bloomberg)
Firstly, it's important to consider just how dumb that is.
Outside of that, this is a program that I could actually get behind: the government is buying up to $1.4T in Paper from eligible institutions, and it appears to be working.
If Detroit Falls, Foreign Makers Could Be Buffer (NYT)
This isn't plausible: the lag would be too long, jobs would be scarce, and the long term impact could prove devastating.
GM has to survive, as much as I dislike it, and so does Ford in all probability; Chrysler doesn't show much hope. If we just look at the numbers for GM (from the article) we're talking about 100k jobs, and if you consider the entire of the auto industry and the network that it relies on, we're looking at 2.3% of the economic output of the country.
There's also this to consider: by the sheer fact that we manufacturer (our) cars in this country we create a competitive environment helping to stabilize prices. If we no longer do that, we're at the will of foreign importers in whole, who can set their price points without regard (well, kind of).
British Economy Balks (AP)
The Confederation of British Industry is calling for GDP growth of -1.7% in 2009.
IMF Needs Money (BBC)
Objectivists generally dislike me for my level of philanthropic endeavor, but even I find this humorous. Why is it that in any "crisis" people have to hold hundreds of meetings in an eager attempt to look so terribly important?
I would argue that the danger facing smaller, less stable countries isn't considerably more urgent or dire that just a short while ago, and further that the injection of this money is nothing more than show. The idea that millions, or hundreds of millions, or even billions of dollars is going to right-size an economy that has thus far barely tread water (even in the brightest of circumstances) is borderline absurd; effectively like handing out umbrellas in a hurricane.
And the larger countries, their issues are largely structural; there isn't much that the IMF can do there, either.
U.S. Unemployment To Peak At 7.5% (Reuters)
According to a survey we should find the bottom at 7.5%
Isn't that the number that J.P. Morgan Chase came up with in the WaMu presentation?
--William Richards

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