Are the Larry Summers Leaks a Mistake?

Many, like Paul Krugman, are pointing to this flurry of press surrounding Larry Summers as a huge fumble on the part of the Obama administration.

The general idea — Obama probably doesn’t want Summers, so leaking him as a possibility for Fed Chair was a huge error.

Oddly, with the same breath these people contend that, if the administration does want Summers, they have seriously mishandled the situation. ...

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Think Obama Wants Larry Summers as Fed Chair?

Obviously I’ve never met either one of them, but I sincerely, sincerely doubt it.

I don’t think Obama has anything against Larry Summers personally. It probably is true that they have a friendly relationship. But does Obama want him as Fed Chair…? Highly unlikely.

Then what is all this press about Summers?

The investment banks have a powerful lobby – far too powerful – and they are just as entrenched with the Democrats as they are with ...

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Debt Ceiling – Cause and Effect

It is one of the most absurd political bargaining chips ever used. But it is a chip nonetheless, so Congress can’t help latching onto it.

Are you worried about the debt ceiling? Everyone seems to be. The problem is, they have this whole equation backwards. The cause and effect isn’t what it seems to be.

The general narrative

You’ve heard this before. Government spending is completely out of control ...

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Detroit’s Bankruptcy – Meredith Whitney Can’t Give up her Shtick

A lot of famous market prognosticators only had one good call.

John Paulson and Peter Schiff with real estate, Roubini with the market’s continued crashing during 2008….the list goes on and on. Look at any time period. There is always a slew of analysts that were feverishly calling for some sort of crash — and they were right. The problem is they were only right once.

Meredith Whitney has built a career ...

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Gone Fishing Portfolio – Incorrect Returns Posted

Sometimes the numbers are just wrong.

I was recently asked about the Gone Fishing Portfolio. There is an entire books dedicated to this portfolio, although I admit I haven’t read it, and I may never read it. I don’t mean to be dismissive, but if I read every financial book like this that is pumped out it would consume every waking hour I have.

From what I understand, there is nothing “wrong” ...

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Detroit’s Bankruptcy – Now on to Robocop 2?

With Detroit’s bankruptcy, we’ve seen much of Robocop come to pass – all except for the actual Robocop. But there was a sequel. Thankfully events in Robocop 2 haven’t happened, and don’t even have a chance of happening…yet.

And when I say “haven’t happened,” I’m not talking about the cybernetic police officers. I’m talking about much more important stuff.

As I and many others have More →


One Reason Banks are Different

I was recently asked whether a client could lose investment assets because of a bankruptcy of the asset custodian.

For example, if you have your investments in a Charles Schwab investment account, can you lose that money if Charles Schwab goes out of business? Is it the same as when a bank goes out of business?

The short answer is “no,” but it got me thinking about balance sheets, banks and how banks are fundamentally different from ...

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Goldman Sachs – Earnings Up, Stock Down…Happens all the Time

Big news this morning is that Goldman Sachs beat earnings forecasts by a large margin. 

Earnings weren’t just “up,” they were way above what analysts were “expecting.”

Wish you bought the stock yesterday before the announcement? Well, as of right now the stock is down -1.75%.

It may seem odd, but I’ve seen this so many times that it doesn’t surprise me anymore. Bad earnings – stock is up. Good earnings – stock ...

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Market at All-Time High. Do You Sell?

With the markets at all time highs, the financial media is posing the question – do you sell now?

Short and simple explanation:

1. When the media says the market, they are usually talking about the Dow Jones Industrial Average or the S&P 500 Index. Basically these are both made of Large Cap US stocks. So when they say the “market” is at all time highs, ...

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