Nuthin But 'Net: The Return
Posted: Thursday, January 10, 2008 12:07 PM by Chris Colvin
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Nuthin' but 'Net
Hi. After a break over the holidays, this twice-weekly tour of the internet and the blogosphere in particular is back. Did anything happen while I was out?
Oh yeah. People actually caucused and voted! Since you can get your fill of horserace and tactics coverage from innumerable sources, I'll just stick to the relentless and deserved bashing the media is taking in the wake of New Hampshire. Salon has two representative offerings up: Joe Conason takes the overall view of media hostility toward Hillary Clinton boomeranging (a phenomenon which has shown itself in the 800+ comments posted to Brian's essay on this very blog.) And Rebecca Traister looks at it from the female voters' point of view.
And Josh Marshall looks at Karl Rove's offering on Obama in today's WSJ and points to the "dog-whistle" words embedded therein.
Fed Chairman Ben Bernanke says the Fed is ready to aggressively lower the fed funds rate because "downside risks to the economy have become more pronounced." See Citi/Merrill below for more on the nature of the downside. BUT! (and there's always an ever-lovin' but, isn't there) the Chairman acknowledges that inflation pressures may be putting the fed's ability to slash at will into a nasty box. QUOTE: "...any tendency of inflation expectations to become unmoored or for the Fed’s inflation-fighting credibility to be eroded could greatly complicate the task of sustaining price stability and reduce the central bank’s policy flexibility to counter shortfalls in growth in the future." To quote a great American philosopher: D'oh!Read Bernanke here.
Oh and by the way, Wall Street may have its collective opinion about the dire need to slash the Fed Funds rate, but Fed Funds has its own marketplace, and that freely-traded free market is NOT indicating the need for a rate cut. See for yourself. (Note the difference between the TARGET rate and the daily (EFFECTIVE) Fed Funds rate. Hint: there isn't one.)
And then there was today's big "news" that Bank of America may, or may not, buy troubled Countrywide. At least Bloomberg's version of the story is less heavy on the may/may not than the WSJ item that broke the news. I'll try to find the stat I saw that the value of Countrywide's Real Estate Owned (REO-- foreclosed houses that end up on the lender's balance sheet) is approaching the value of the entire company. Oops.. found it.
Alan Abelson's Barron's column is a good read this week-- with an important note that I've highlighted here in the past: the Bureau of Labor Statistics "birth/death model" and its distortion of the jobs numbers in this country. QUOTE: "All told, supposedly 18,000 jobs were added. We might note right off the bat that there were no fewer than 66,000 mythical jobs added, courtesy of the infamous birth/death adjustment; save for that curious confection, the total would have gone considerably negative. That handy adjustment, incidentally, was responsible for 89% of all the reported payroll additions in 2007. Unemployment jumped to 5%, from 4.7%. And the big losers were widely dispersed, paced by construction, where 49,000 jobs vanished last month and manufacturing, which lost 31,000. Apart from health-care and restaurants and bars, there were virtually no conspicuous gainers. As Philippa and Doug quip: "Our new economic model: eat, drink and check into the hospital." And here's the whole thing.
Citigroup and Merrill Lynch are hitting up foreign investors before hitting the confessional to discloses Q4 loses that could top-- ahem - rrrrr - cough, cough-- 25 billion dollars. WSJ page 1 today. (sub req. for full article)
The housing/mortgage/economy blog CalculatedRisk has gotten a burst of MSM attention lately, including links in Paul Krugman's blog (niiiice!). And I'm proud to say this space has been a longtime proponent of CR and Tanta's work. Here's today's link to CR's post Goldman Sachs' 2008 recession call. [And by the way, here's a shameless plug: CR and Tanta have started a subscription newsletter on housing and mortgage issues. If you are thinking of buying or selling a house, or if you just want to stay on top of this vital economic issue, you can click on the link at the top of the site to subscribe. I already feel like I've gotten my 60 bucks worth. OK plug over.]
