Monday, June 25, 2007

Are We in Las Vegas or On the Titanic?

excerpts from this week's report

"This week all eyes will be focused on the FOMC meeting. And the much of that focus will be on the language re easing. This is a side dish to the far more important meal of understanding the position of the Fed vis-à-vis credit derivatives, spillover effects (a/k/a contagion), and Fed policy before, during, and after periods of stress.

The perma bulls will say that the current bout of problems centered on sub prime mortgages will not metastasize, and that the sub prime problems are a lot like Las Vegas - what happens in the sub prime space, stays in the sub prime space. On the other hand, the perma bears believe that sub prime problems are more like the Titanic - just the tip of the iceberg.

Whatever one’s view, the sense is that we are entering a very challenging period for asset managers. The stress fractures caused by..."

"Neither the global economy nor the financial markets have been stress tested re globalization and decoupling and credit derivatives and unregulated money. The sub prime problems of Bear Stearns may..."

"This is no longer Greenspan’s Fed. And the solution to every major financial crisis may not be blowing yet another bubble. In fact, in speech after speech, the emphasis by the Fed heads and Treasury Secretary Paulson is on..."

also in this week's report

* Current Blue Marble Research Fed Model
* Model Growth Portfolio
* Key Economic Indicators

Note: To view this week's report, please click on the Blue Marble Research services link to your left.

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