Which is, if they believe there is risk, you will see it reflected in the market for these instruments. Name the television channel or radio, it doesn't matter, CNBC or even MSNBC or even NPR, bond buyers are a bit nervous right now. And at the risk of being banned (again), one theme being applied right now is weariness towards industries with unions; both Bloomberg and CNBC (don't really watch Fox Business) had on guys who traded a lot of paper who said they aren't touching industrials' debt if there is a union; or really any paper that has a union associated with that company. And it was a message being echoed over and over again, because they saw what happened at GM. Now you take this as you want, frankly I think its a bit overblown, because GM was really a special case in my opinion. Really time will tell if the market is somewhat shy on those bonds, but if it is true, then those companies are going to be forced to offer a higher rate, that's really it.

Regarding government bonds, be it treasuries or even agency paper, folks who regularly buy this stuff in gobs and gobs are too feeling vulnerable. I don't think it was just the Chinese who were laughing at Geithner when those remarks were heard. Only, I suspect in both the Chinese and here, the laughter was one of the nervous variety. The Chinese are long term players like other bond holders, and both aren't sure they see a light at the end of the tunnel. Deficit is what, 12%? It is supposed to drop, but still the numbers are astronomical. Even raising taxes on the rich may not be enough. Between the pumping of the money and the government spending, many are thinking that longer term inflation is going to kick in. And to folks, like the Chinese, it is beginning to look like they will be paid back in cheaper dollars. Competition for money is coming, be it from Europe or here, to meet needs not being met by declining taxes or what have you. At the end of the day, rates could be going up. That is why, for the most part, you see the sell offs.

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www.venomopolis.com

This has been expected since last September in terms of creep to quality. The problem is...jobs. Even the remaining employed engineers are iffy right now. Hard to make payments without steady earnings.

Keep an eye on the 1 year LIBOR. Most of these ARMS adjust to some percent above LIBOR, which is very low right now.

and events have shown that theirs were not worst case scenarios. Good post.

But a question: what's an unsecuritized ARM? Not what it sounds like, I hope.

Yeah, btw, can I immigrate? ;)

No, I'm not familiar with Armstrong, but on EP, you can link and quote in comments by creating a user account on the upper left. All sorts of features are enabled, like fully featured HTML writing and the site is a community site.

Maybe you can link up and quote some of his better work for us?

Newberry is so correct, and, as usual, Krugman is his usual flibbertigibbet self, all over the landscape, far more of a "political economist" (or looney tunes, as most, if not all, of the Nobel Prize recipients in economics have been).

To quote Alan Greenspan (whoever thought things would get so primitive that anyone would be quoting Greenspan!!), extreme credit leads to extreme amounts of speculation which leads to economic collapse (or words to that effect).

And, as so correctly pointed out, we're back at the same place because the anti-Roosevelt administration, the Obama Administration, is carrying on the Bush Administration (and the Clinton, and previous Bush, and Reagan's) policies, a total destruction continuum.

It has taken me many years of reading and studying to appreciate that the three truly economic weapons-of-mass-destruction (and major fraudulent legislation) were: the Monetary Control Act of 1980, the Gramm-Leach-Bliley Act of 1999 (Financial Services Modernization Act) and the Commodity Futures Modernization Act of 2000.

At this point, we must truly embrace the radical, it is time to review Henry George and the present exemplar of his really human and economic democracy philosphy, JW Smith (ied.info).

"Geithner and his buddy Bernanke are bumbling idiots."

You wouldn't mind if we took away from them the retardation defense, would you? And please feel free to introduce the moral dimension. Such a construct might then have you describing them as protozoa or fungi which from that latter perspective would be entirely just in my view. Of the two, Summers is the more contemptable. Geithner, naturally a follower, has learned his slither from others while Summers, on the other hand, is a genuine maestro in his own right. Wonder which Obama contributor was most influential in securing Summer's appointment?

In some cities that's been happening since January (yes, I linked the entire sentence)

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Maximum jobs, not maximum profits.

the financial oligarchy? Link

Large dealers in the $26 trillion credit default swap market are blocking CME Group's (CME.N) efforts to clear the trades in a bid to retain their "oligopoly" over the market, hedge fund BlueMountain Capital Management said on Monday.

Profit motives and interests of the financial conglomerates/oligarchy are in direct conflict with our interests. Transparency means that less profit opportunities for these financial conglomerates.