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financial crisis

What To Do with the Toxic Bank Assets – Give Them for Free to Citizens

Let’s say that the trillion or so of toxic assets would face two choices – go bankrupt or be offered for free to willing persons. What should the U.S. government do?
Some other blogs said that they should be given to the bank executives, instead of their salaries. Nice try. But they know how to do with them, and they would squeeze more money out of the government big pockets, in the form of another smart bailout plan.
No, we at don’t like the idea. But what if we would start another system of getting rid of those assets?Read More »What To Do with the Toxic Bank Assets – Give Them for Free to Citizens

The Davos Forum Day 2 – Other Investing Lessons

davos-2009-pictureFinally the world business leaders started to do their representative jobs in Davos, Switzerland, at the World Economic Forum. In other words, we at started to see them throwing to the world some hints with regards to their thinking on what constitute a good investment for the remaining 2009. Especially given the current financial crisis, this was much expected of them…

M&A business has slumped in the past year but companies with strong balance sheets positions are out on hunting bargains.

Most of the business leaders meeting in Davos this week said they saw opportunities in the global downturn, though the traditional leverage of the corporate power is out and a hard-nosed focus on cost cutting is the order of the day.Read More »The Davos Forum Day 2 – Other Investing Lessons

The Davos Forum and the Financial Crisis Thinking of the CEO’s

davosThe World Economic Forum (WEF) has become a sort of pilgrimage for all sorts of real or would-be gurus. Which is not bad at all if you think a little bit – at least you find out how most of the world business leaders think. Or what is what they want us to believe they think.

Well, we here at like charades, so we thought: why shouldn’t we try to read among the lines of the 2009 Davos WEF? Afterall, everything is a matter of interpretation, and most world leaders have an expression these days – the crisis is only in our minds and when it will be over there, it will soon end also in the real world.Read More »The Davos Forum and the Financial Crisis Thinking of the CEO’s

Will Further Interest Rates Reductions Boost The Economy?

Well, our survey has different views included, as usually. The answers tend to be pretty structured though, so let’s see the results.

The theory, as previously explained by in a previous investing blog, says that the interest rate cut executed by the FED should boost the US economy. By reducing the refference interest rate, FED actually reduces the borrowing costs of the US banks. This is because the banks attract an important portion of their cash through loans from FED at the official interest rates. obviously, the lower the refference rate is, the lower the costs for the banks, which in turn are encouraged to lend money at smaller costs. The ultimate beneficiaries in this lending chain are the final consumers/companies, which should benefit from borrowing facilities available at lower costs.Read More »Will Further Interest Rates Reductions Boost The Economy?

FED Warning On More Tough Times Ahead

bernake-feds-chairmanFederal Reserve Chairman Ben S. Bernanke warned today in an interview that a fiscal stimulus package will be enough to generate an economic recovery. He also added that the government may need to buy or guarantee banks’ problematic assets to revive growth.

“Fiscal actions are unlikely to promote a lasting recovery unless they are accompanied by strong measures to further stabilize and strengthen the financial system,” Bernanke said in a speech held today at the London School of Economics. “More capital injections and guarantees may become necessary to ensure stability and the normalization of credit markets.”Read More »FED Warning On More Tough Times Ahead

US Treasury Plans To Stimulate Finance Consumption

US Treasury picture and photoThe Treasury Secretary Henry Paulson, this Keynesian economist of the 21st century, is ready again for a blow under the America’s tight belt. His theory is simple – if people lost too much weight, we should give them a fist of amphetamines and the promise of a wonderful land after the crisis will pass. Amphetamines will give them the sensation of light in the darkness of the financial crisis, whereas the promises show that Treasury is trying to do something for the nation. And according to the principle that “any action is better than sitting and waiting”, Treasury has launched itself into water. As we noticed few months back on…Read More »US Treasury Plans To Stimulate Finance Consumption