The downside to the global economy

Posted by & filed under Economic Analysis, Governments & Regulators.

Description:  Fortune editors explain how problems in places like Dubai and Greece are affecting U.S. markets. Source: CNNMoney – video report   Date: 02/10/2010 Link: http://money.cnn.com/video/fortune/2010/02/10/f_sl_greece_euro.fortune/ Questions for discussion: Summarize the impact that global debt levels and deleveraging may have on domestic as well as international investing strategies? What strategy would you advise – particularly… Read more »

Junkyard treasure:High-yield bonds saved from the scrapheap

Posted by & filed under Market Analysis.

Description: High-yield corporate bonds are being priced as if few of these companies are going out of business, evidence that income-seeking investors are increasingly accepting the greater risks attached to low-rated debt. Source: Marketwatch.com Date: 02/14/2010 Link:  http://www.marketwatch.com/story/high-yield-bonds-show-investors-the-money-2010-02-12 Questions for discussion: Summarize the current market conditions for corporate bonds. How should financial managers deal with… Read more »

Goldman Sachs’s Spilker, Overseer of $871 Billion, Exits Firm

Posted by & filed under Management Issues.

Description:   Goldman Sachs Group Inc. investment management co-head Marc Spilker is leaving the firm after two decades and will be replaced by a predecessor. Source: Bloomberg.com Date: 02/13/2010 Link: http://www.bloomberg.com/apps/news?pid=20601103&sid=aheYV90R253M Questions for discussion: How do you think this managerial change might affect investment strategies at the firm? How might investors react?

Volcker says must let big financial firms fail

Posted by & filed under Governments & Regulators.

Description: Large financial institutions that engage in speculative activities for profit should be allowed to fail if they get in trouble, White House advisor Paul Volcker said on Sunday. Source: Reuters.com Date: 02/014/2010 Link:  http://www.reuters.com/article/idUSN1414676420100214?type=marketsNews Questions for discussion:  Do you agree with Paul Volcker’s argument? Explain your answer. What would the impact be on risk… Read more »

Corporate Bond Spreads Rise Most Since November: Credit Markets

Posted by & filed under Governments & Regulators.

Description:  Corporate borrowing costs are rising at the fastest pace in more than two months on concern that worsening government finances will slow the global economy and make it harder for companies to meet debt payments. Source: Bloomberg.com Date: 02/08/2010 Link: http://www.bloomberg.com/apps/news?pid=20601103&sid=auWwLKPsLRFM Questions for discussion: Summarize the report and the impact this trend will have… Read more »

Obama proposes new limits on big bank risky trading

Posted by & filed under Governments & Regulators, Industry Analysis.

Description: In his toughest response yet to the financial crisis, Obama proposed Thursday that strict limits be imposed on the size and trading activities of the nation’s biggest banks. The proposal aims to deter commercial banks from becoming so large that they put the broader economy at risk and distort normal competitive forces. The president… Read more »

Decline in U.S. Stocks Pays Options Traders 75% Profit on VIX

Posted by & filed under Growth & Valuation, Market Analysis.

Description:  The biggest sell-off in the Standard & Poor’s 500 Index since March is rewarding options traders who bet on a surge in volatility with gains of 75 percent. Source: Bloomberg.com Date: 01/23/2010 Link: http://www.bloomberg.com/apps/news?pid=20601103&sid=aZOPq7yDKhng Questions for discussion: What sort of risk is involved with these instruments? Who would be interested in them? Do you… Read more »

How the financial system fell apart

Posted by & filed under Uncategorized.

Description:  PIMCO CEO Mohamed El-Erian explains how collapse of Lehman Brothers destroyed confidence in the economy. Source: CNNMoney – video report   Date: 12/10/2009 Link: http://money.cnn.com/video/fortune/2009/12/08/f_cs_pimco_food.fortune/ Questions for discussion:  Summarize the reasons given for the financial crisis. Do you believe the fear expressed by El-Erian was experienced by everyone? Explain your answer. How do you… Read more »

Enduring TARP woes

Posted by & filed under Uncategorized.

Description:  Elizabeth Warren, chairwoman of the TARP oversight committee, shares her two biggest worries looking forward. Source: CNNMoney – video report   Date: 11/20/2009 Link: http://money.cnn.com/video/news/2009/11/20/n_la_warren_tarp_concerns.cnnmoney Questions for discussion:  Summarize the concerns expressed in this interview. Do you share in these concerns? Explain your thinking.

S&P, Moody’s and Fitch Are Sued by Ohio Over Ratings

Posted by & filed under Uncategorized.

Description: Standard & Poor’s, Moody’s Corp. and Fitch Inc. were sued by Ohio Attorney General Richard Cordray, who said the three companies disregarded their responsibility to provide “accurate credit ratings of investments.” Source: Bloomberg.com Date: 11/20/2009 Link: http://www.bloomberg.com/apps/news?pid=20601103&sid=aSfRXwQ.8m5Q Questions for discussion: Summarize the arguments for and against the defendants in this case? Do you agree… Read more »