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Posts Tagged ‘asset bubbles’

Roubini on Greed and Amorality

Posted by Larry Doyle on August 26th, 2010 5:38 AM |

Nouriel Roubini is both revered and derided. While he gains huge credit for having forecasted our economic meltdown, he is equally maligned for having missed the 2009 rally in the markets. I am less concerned with Roubini’s market calls, but I am very interested in his views on the inner workings of our economy and market structures. To this end I was thrilled to review Roubini’s recent Project Syndicate commentary,¬†Gordon Gekko Reborn.

As you read Roubini’s commentary, I encourage you to think whether the recently enacted Financial Regulatory Reform package will fully address and implement the changes Roubini deems necessary. I will add my take as we navigate. On that note, Roubini writes: (more…)

Let’s Revisit Whether the Market is Being Manipulated

Posted by Larry Doyle on March 22nd, 2010 9:52 AM |

Is the stock market being manipulated?

I can not count the number of times I have been asked that question over the last 9 months. Rather than my offering personal opinions which market pundits may view as sour grapes or worse, I want to revisit a ten-minute segment of my interview last evening with Phil Davis.

The segment runs from 29:45 until 40:00 (audio player provided below). If you do nothing else today, please listen to this dialogue between Phil and myself. Neither of us goes into this conversation with agendas or preconceived notions in an attempt to score points. I will offer an edited version here. I think you will find the information, thoughts, and opinions offered to be enlightening. (more…)

Federal Reserve Says “One More Drink”

Posted by Larry Doyle on December 2nd, 2009 2:31 PM |

Illustration by Zhou Tao

I have to admit, I chuckled upon reading the news today that the Federal Reserve is debating whether and how it may fight the prospects of asset bubbles developing. The Wall Street Journal addresses this story in writing,
Fed Debates New Role: Bubble Fighter:

Not so long ago, Federal Reserve officials were confident they knew what to do when they saw bubbles building in prices of stocks, houses or other assets: Nothing.

Now, as Fed Chairman Ben Bernanke faces a confirmation hearing Thursday on a second four-year term, he and others at the central bank are rethinking the hands-off approach they’ve followed over the past decade. On the heels of a burst housing-and-credit bubble, Mr. Bernanke now calls financial booms “perhaps the most difficult problem for monetary policy this decade.”

With Asian property prices soaring and gold prices busting records almost daily, the debate comes at a critical time. Mr. Bernanke wants to use his powers as a bank regulator to stamp out bubbles, but the Senate Banking Committee, which will grill him later this week, is considering stripping the Fed of its regulatory power.

At the same time, pending legislation in the House could leave Mr. Bernanke running a less independent institution. The House Financial Services Committee has passed a measure that would subject the Fed’s interest-rate decisions to scrutiny by the Government Accountability Office, an investigative arm of Congress. Mr. Bernanke and others at the Fed fear that with Congress looking over their shoulders, any decision they make about interest rates would be subjected to the winds of politics — making it harder to control inflation or financial bubbles.

My immediate thought upon reading this article is to think of the bartender who is happy to push one more drink upon an overlubricated patron. Or perhaps a junkie who is willing to sell a down and out addict one more fix in order to ease the pain. (more…)






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