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Athens Today. London Tomorrow? Washington Next Week?

Posted by Larry Doyle on May 5th, 2010 8:20 AM |

With social unrest increasing in Greece, anxieties skyrocketing across the EU, and the Euro making new 12 month lows, the question begs as to whether this crisis within the EU can be contained. Is the EU, with the support of the IMF, willing to collectively underwrite the fiscal disaster currently focused within Greece? The German citizenry is showing very little appetite to subsidize this Greek tragedy.

While the EU’s political fortitude is a critical question, ultimately the reality of the mountainous debt levels must be faced. Global government stimulus has been able to mask, if not outright disguise, these debts for a period, but the debts themselves are not going away. How will the EU address this debt?

1. Devalue. That’s a given. It’s only a question of how and when.
2. Restructure. Look for more on this.
3. Default. Do not discount this reality. Read the rest »


Eli Broad on Education: “The American Public Doesn’t Get It”

Posted by Larry Doyle on May 4th, 2010 2:36 PM |

I feel strongly that the very future of our country is directly tied to the quality of our secondary schools. How are we doing? Not very well. The United States has plummeted in terms of educational rankings over the last few decades.

While I have written on this topic periodically, let’s listen to a Bloomberg interview with Eli Broad on U. S. Education. Eli Broad and his wife Edythe are renowned philanthropists. The Broad Foundation does tremendous work. During this brief interview, Broad hits hard on the issues of families, educational management, and the fact that America has become “fat, dumb, happy.”

The truth may hurt, but if our nation wants to make progress we had better face the truth head on. I thank Eli Broad for speaking so bluntly on one of the most important topics impacting our future well being.  – LD

Click on the image and then wait a few seconds for the video to load:


Obama Acknowledges Company Charges Due to Healthcare Reform

Posted by Larry Doyle on May 4th, 2010 12:45 PM |

Not that you would find it in any media outlets (believe me, I’ve looked for the last hour), but earlier today President Obama publicly acknowledged that American companies will be forced to take immediate charges to income from the recently enacted healthcare reform.

Recall that members of Congress railed on a number of corporate executives for highlighting these charges shortly after the legislation was passed. Rep. Henry Waxman initially called a special meeting to castigate the corporate executives, but then tucked his tail between his legs and cancelled that meeting when it became apparent that he did not truly understand the basic accounting principles necessitating these charges. Read the rest »


Today’s Market Meltdown Is Due to Europe’s House of Cards

Posted by Larry Doyle on May 4th, 2010 10:33 AM |

Thanks to 12th Street Capital for bringing my attention to Europe’s Web of Debt highlighted the other day in The New York Times. The tangled web of interconnected liabilities is only exacerbated by exposures in the credit derivatives market. This situation is very similar to the interconnected Wall Street meltdown in 2008. Think of Greece as Bear Stearns and Spain as Lehman for example. (The image below is too large to fit in the allotted space on this site, so click on the image to view its entirety.)

Banks and governments in these five shaky economies owe each other many billions of euros — converted here to dollars — and have even larger debts to Britain, France and Germany. Arrow widths are proportional to debt amounts.

Today’s market meltdown is directly related to this tangled web.

LD


America’s Future Is Dark Unless…

Posted by Larry Doyle on May 4th, 2010 9:28 AM |

Land of the free, home of the brave.

No doubt, the United States of America is the greatest nation on the face of the earth. I love my country. I love hearing the stories of immigrants from all parts of the world who have come here to make a better life. Even though there is current concern around our immigration policy (or lack thereof), there exist endless numbers of stories of people making real sacrifice and, in turn, real progress for their families. I am inspired by these stories.

Despite all our greatness, I am extremely concerned that our nation will erode from within unless there is serious change in one very large corner of our political and economic landscape. What is it? Read the rest »


New Standards at Goldman Sachs Have Me ROFLMAO

Posted by Larry Doyle on May 3rd, 2010 3:09 PM |

Is Goldman Sachs finding religion? Is the highest profile firm on Wall Street about to publicly pronounce a measure of self-imposed penance given the recent civil charges and criminal investigation brought against it by the SEC and DOJ respectively?

A report in today’s Financial Times indicates that Goldman has entered the confessional and is ready to let the public know just how meaningful its recompense will be. Read the rest »


Auction-Rate Securities: The Fraud Continues

Posted by Larry Doyle on May 3rd, 2010 10:57 AM |

To: Wall Street, Washington, and State Capitols

From: Sense on Cents

Re: Auction-Rate Securities Fraud and Financial Regulatory Reform

To all those enmeshed on both sides of the political-financial incest and currently debating and lobbying on the merits of proposed financial regulatory reform, you are proving yourselves to be nothing more than massive frauds yourselves by not fully addressing and exposing the single greatest financial fraud perpetrated on American investors, that is the world of auction-rate securities.

To President Obama, members of Congress, financial regulators, and Wall Street executives, your unwillingness and inability to openly and honestly address the perpetuation of the fraud surrounding ARS ($150 billion ARS remain outstanding) paints you as nothing more than aiding and abetting the fraud itself. Who amongst you is even willing to fully address this topic? Read the rest »


Warren Buffett: Financial Statesman or Just Another Hack?

Posted by Larry Doyle on May 3rd, 2010 8:54 AM |

Warren Buffett

The Oracle of Omaha Warren Buffett is widely regarded as a true financial statesman. From his understated lifestyle to his self-deprecating manner to his simple wisdom in his books, Buffett has always appeared to be a world apart from most, if not all, other financial titans. While Buffett deserves plenty of the respect accorded him, let’s not totally sanctify him just yet. Why?

Buffett’s widely publicized opinions on the regulations of financial derivatives and the treatment of Goldman Sachs also show him to be just another financial hack (albeit it a VERY BIG one) “talking his positions.” Let’s navigate.

In regard to derivatives, let’s not forget that none other than Buffett defined these financial instruments as ‘weapons of mass destruction.’ Read the rest »


No Quarter Radio’s Sense on Cents with Larry Doyle Welcomes Back Rick Davis of Consumer Metrics Institute

Posted by Larry Doyle on May 1st, 2010 9:53 AM |

UPDATE: This episode of NQR’s Sense on Cents with Larry Doyle has concluded. You can listen to a recording of the episode in its entirety by clicking the play button on the audio player provided below. Once the audio begins, you can advance or rewind to any portion of the episode by clicking at any point along the play bar.

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Tomorrow evening, Sunday May 2nd from 8-9pm ET, No Quarter Radio’s Sense on Cents with Larry Doyle Welcomes Back Rick Davis of Consumer Metrics Institute. If you have even a passing interest in the economy and the markets, take the hour and listen to this show. You will not be disappointed.

I first introduced Rick Davis of the Consumer Metrics Institute to the Sense on Cents audience on March 27th. The positive response to my interview with Rick was overwhelming. At that point in time, I realized Rick’s amazingly thoughtful and insightful analysis of the economy was not only way ahead of the curve but was truly focused on providing real truth, transparency and integrity across our economic landscape. Read the rest »


April 2010 Market Review

Posted by Larry Doyle on May 1st, 2010 9:30 AM |

Did spring, in the form of April’s market returns, just come in like a lamb? Will spring, in the form of 2nd quarter GDP, go out like a lion? Will that lion be robust and energized, or an angry beast?

April’s returns are now in the books. Many of the themes remain the same. Those include:

1. A trend toward disinflation helping the bond market primarily.

2. Easy money from the Fed supporting all markets.

3. Improved corporate earnings (be aware that earnings comparisons are year over year, and April 2009 was the economic abyss). Read the rest »


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Larry Doyle

Larry Doyle A Wall Street veteran's views and instincts on the markets, economy, and all things financial.







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