Video-o-rama: Wall Street slumps on economic fears

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Stock markets came under pressure over the past few days as skepticism crept in that economic green shoots could be withering. On top of that, fears that the the US could be facing a credit rating downgrade (are the rating agencies now relevant again?) also caused losses for the US dollar and bonds.

These issues, together with another dose of discussion about the repayment of TARP funds, featured prominently in this week’s video clips. Commentators included in the selection below include James Galbraith, Jim Bianco, Robert Shiller, Sam Stovall, Bill Gross, David Rosenberg, Jim Rogers and Steve Leuthold.

The compilation kicks off with a top-quality interview with James Galbraith, saying that the banks can hardly lose but the rest of us aren’t so lucky, and concludes with the “American Casino” movie trailer.

Yahoo Finance, Tech Ticker: Galbraith – banks can hardly lose
“Big banks have raised billions since the stress tests and policymakers are now turning their bailout affections to life insurers and automakers. Is the government trying to tell us the crisis in the financial sector (proper) is over?

“While it’s too soon to say they’re out of the woods, ‘the government has set up a situation where the banks can hardly lose’, says James Galbraith, economist, professor and author of ‘The Predator State: How Conservatives Abandoned the Free Market and Why Liberals Should Too’.

“Beyond the TARP funds – which Galbraith calls an ‘unproductive use of Federal borrowing’ – banks are benefiting from lending programs that effectively allow them to borrow at zero and reinvest in Treasuries at around 3%. ‘A bank doesn’t have to do anything to make money,’ he says. ‘The banks’ return on equity is going to be very good. They’re going to be able to restore their finances.’

“While this is good for banks and a justification for the sector’s recent rally, the problem is the government’s ‘free money’ program means banks have little or no incentive to do any actual lending. Combined with rising unemployment and the ongoing housing crisis, this means any recovery is likely to be muted, at best, Galbraith says. Furthermore, anyone hoping for a return anytime soon to the salad days of the mid-2000s is delusional.”

Source: Yahoo Finance, Tech Ticker, May 21, 2009.

CNBC: Geithner – banking hearing
“Treasury Secretary Timothy Geithner gives his testimony before the Senate Banking Committee on TARP.”

Source: CNBC, May 20, 2009.

CNBC: Implications of repaying TARP
“Repaying TARP and what that means, with Bob Jones, Old National Bancorp; Lou Brien, DRW Trading Group strategist; and Jim Bianco, Bianco Research president.”

Source: CNBC, May 19, 2009.

CNBC: Credit card overhaul
“The Senate voted overwhelmingly on Tuesday to rein in rate increases and excessive fees, and the House could pass this legislation tomorrow [Thursday]. CNBC’s Bertha Coombs has the details.”

Source: CNBC, May 20, 2009.

Business Week: The Fed is in no rush to raise rates
“Tame inflation means Bernanke has time. With so much idle labor and production capacity, the economy would have to grow beyond the most opimistic forecast for three years before wages and prices felt any notable upward pressure.”

Source: Business Week, May 20, 2009.

Financial Times: Robert Shiller on the outlook for house prices
“Robert Shiller of Yale University talks to Martin Sandbu about the outlook for housing and equity markets, the value of sovereign debt, and the government response to the economic slowdown.”

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Source: Financial Times, May 19, 2009.

Fox Business: S&P’s Sam Stovall – recovery by 3Q

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Source: Fox Business, May 19, 2009.

Political Math: The national debt road trip
“How do the Obama deficits compare with past presidents? And how did the national debt get so big anyway. This video tries to answer those questions by looking at the debt as a road trip and seeing how fast different administrations have been traveling.”

Source: Political Math (via YouTube), May 15, 2009.

CNBC: US could lose AAA rating
“Investors are concerned the US will follow the UK and lose its AAA rating, according to Bill Gross, Pimco, and that could be driving today’s drop in the dollar.”

Source: CNBC, May 21, 2009.

The Wall Street Journal: Market focus on dollar weakness
“The US dollar could be on the brink of a major drop in value as investors and central bank reserve managers start to question their appetite for Treasurys and the greenback’s safe-haven status wears off, prominent currency watchers warn. The euro and even embattled sterling have shot higher against the US currency in recent days despite a lack of meaningfully positive economic news.

“Now some heavyweight strategists think the euro could sweep up to 9% higher against the dollar in a matter of weeks, in a move that could prompt a new era of official intervention in the currency markets.”

Source: The Wall Street Journal, May 21, 2009.

John Authers (Financial Times): Low volatility
“When volatility is down it means investors are getting calmer. But equity volatility currently seems to have a stronger impact on currencies.”

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Click here for the article.

Source: Financial Times, May 21, 2009.

Bloomberg: David Rosenberg says US stocks may retest March lows
“David Rosenberg, chief economist and strategist at Gluskin Sheff & Associates, talks with Bloomberg’s Erik Schatzker about the outlook for the US stock market. Rosenberg, former chief North American economist at Bank of America-Merrill Lynch, also discusses the state of the global economy, consumer spending and the currency market.”

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Source: Bloomberg, May 21, 2009.

CNBC: Rogers – markets yet to bottom
“Markets have yet to see the bottom, warns Jim Rogers, chairman of Rogers Holdings. He tells Michael Yoshikami, president & chief investment strategist of YCMNET Advisors, CNBC’s Martin Soong & Amanda Drury why. He also reveals what he is buying.”

Source: CNBC, May 20, 2009.

Bloomberg: Leuthold says he may boost stock holdings to 70%
“Steve Leuthold, chairman of Leuthold Weeden Capital Management, talks with Bloomberg’s Betty Liu about the outlook for the US stock market. Leuthold, whose Grizzly Short Fund returned 74% last year, also discusses his expectations for the economy, attempts by banks to repay funds from TARP and investments in gold and silver.”

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Source: Bloomberg, May 20, 2009.

Financial Times: Indian Congress victory welcomed by business
“James Lamont, FT South Asia bureau chief, on the reasons for the Congress Party’s unexpected victory in the Indian elections and the key role of party leader, Sonia Gandhi.”

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Source: Financial Times, May 18, 2009.

CNBC: Rogers – choose silver over gold
“Although Jim Rogers owns gold, he sees better returns in agricultural commodities and silver. Rogers & Michael Yoshikami, president & chief investment strategist, YCMNet Advisors talk strategies with CNBC’s Martin Soong, Amanda Drury & Sri Jegarajah.”

Source: CNBC, May 20, 2009.

CNBC: OPEC wary of rising oil prices
“‘Certainly OPEC’s members are happy, but in the back of their minds they’re looking at the oil price rally coming against a background of rising oil inventories and contracting economic indicators,’ Harry Tchilinguirian of BNP Paribas told CNBC Tuesday.”

Source: CNBC, May 19, 2009.

CNBC: America’s big money bet on Africa
“Insight on why the American investor loves Africa, with Quintin Primo, Capri Capital Partners.”

Source: CNBC, May 21, 2009.

Vimeo: American Casino movie trailer

American Casino movie trailer from Leslie and Andrew Cockburn on Vimeo.

Source: Leslie and Andrew Cockburn, Vimeo, March 2009.

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