I fail to see why investors should engage in an asset liquidation wave, realizing losses, seeking to preserve that which is currently not lacking. Unless again, exogenous, political, factors show up and break the status quo…
Please, click here to read this article in pdf format: july-14-2009
Today is the 220th anniversary of the storming of the Bastille prison, in France. On a 14th of July in 1789, an angry crowd liberated what were mainly political prisoners in this fortress-prison, outside of Paris. The anger had brewed during previous years, as Louis XVI ran into massive deficits, which he sought to cover with rising taxes. People back then thought they had seen the worst crowding-out effect ever, by a careless government. But perhaps they were wrong. Perhaps, with yesterday’s announcement of the US 9-month fiscal deficit of $1.1 trillion, those courageous French seeking to end nonsense have been dwarfed by the American taxpayer. In any major crisis, new ideas are born. In the case of the French crisis of the eighteenth century, the new idea was that quantitative analysis could be useful. Yes, quantitative analysis (what follows is my view only; I invite anyone to check if I am right here) was born with the Tableau Economique, of the so-called physiocrats. This analysis sought to make the point that agriculture in France was important and that the government had to develop its potential (as you can see, the United Auto Workers are not original).
Equities rallied today. Maybe because Meredith Whitney was positive on Goldman, maybe because the market sold Treasuries, or Bank of America may not have to pay $4BN in fees to the US government, or perhaps the macroeconomic data is not as bad as it seems. As we have said in recent letters, endogenous factors alone do not guarantee new lows. This does not mean there cannot be new lows. All I have been saying is that, by itself, the macroeconomic fundamental situation should not push a panic sale, because governments have ensured there is liquidity going to the financial system (We will have more to say about this, in the case of Canada). If this flow of liquidity stopped, or if the market believes that it can stop, or if it is challenged by an exogenous effect, then the spiraling asset deflation could indeed be triggered.
How do I know I am right here? I don’t. I can only hope my own Tableau Economique is right. When stocks fell approx. 25% with the Lehman bankruptcy, between Sept. 15th and Oct 10th 2008, the Libor-OIS spread (= 3-mo Libor minus Overnight rate; www.sibileau.com/martin/2009/07/07 ) shot beyond 364bps. Today, the same spread keeps narrowing in the face of all the negative data. It is still above the 2bps pre-crisis, at approx. 31bps. With the chart below in mind (source: Bloomberg), I fail to see why investors should engage in an asset liquidation wave, realizing losses, seeking to preserve that which is currently not lacking. Unless again, exogenous, political, factors show up and break the status quo.
October 16th, 2011 at 2:04 PM
Visitor recommendations…
[...]one of our visitors recently recommended the following website[...]……
October 17th, 2011 at 11:18 AM
Websites you should visit…
[...]below you’ll find the link to some sites that we think you should visit[...]……
October 19th, 2011 at 12:07 PM
Links…
[...]Sites of interest we have a link to[...]…
October 19th, 2011 at 8:01 PM
Informative and precise…
Its difficult to find informative and precise info but here I found…
October 19th, 2011 at 9:09 PM
Web Developement and Web Marketing…
[...]while the pages we link to underneath are completely unrelated to ours, we think they are worth a look, so have a look[...]…
October 19th, 2011 at 9:52 PM
Car Warranty News…
[...]the time to look at the content or going to we have linked to below the[...]…
October 20th, 2011 at 3:04 AM
Websites we think you should visit…
[...]although websites we backlink to below are considerably not related to ours, we feel they are actually worth a go through, so have a look[...]……
October 20th, 2011 at 8:29 AM
Read was interesting, stay in touch……
[...]please visit the sites we follow, including this one, as it represents our picks from the web[...]……
October 20th, 2011 at 12:33 PM
Car Warranty News…
[...]the time to visit the content or visiting we have linked to below the[...]…
October 20th, 2011 at 9:08 PM
electronics disposal…
[...]while the web sites we link to underneath are completely unrelated to ours, we think they are worth a look, so have a look[...]…
October 21st, 2011 at 2:37 AM
Cool sites…
[...]we came across a cool site that you might enjoy. Take a look if you want[...]……
October 21st, 2011 at 3:52 AM
Read was interesting, stay in touch……
[...]please visit the sites we follow, including this one, as it represents our picks from the web[...]……
October 21st, 2011 at 5:05 AM
Great website…
[...]we like to honor many other internet sites on the web, even if they aren’t linked to us, by linking to them. Under are some webpages worth checking out[...]……
October 21st, 2011 at 6:51 AM
Recent Blogroll Additions……
[...]usually posts some very interesting stuff like this. If you’re new to this site[...]……
October 21st, 2011 at 7:41 AM
Sites we Like……
[...] Every once in a while we choose blogs that we read. Listed below are the latest sites that we choose [...]……
October 21st, 2011 at 8:56 AM
Sources…
[...]check below, are some totally unrelated websites to ours, however, they are most trustworthy sources that we use[...]……
October 21st, 2011 at 9:32 AM
Blogs ou should be reading…
[...]Here is a Great Blog You Might Find Interesting that we Encourage You[...]……
October 21st, 2011 at 11:12 AM
Links Trackback…
[...]Sites of interest we have a link to[...]……
October 21st, 2011 at 1:50 PM
electronics disposal…
[...]while the sites we link to up above are completely unrelated to ours, we think they are worth a look, so have a look[...]…
October 21st, 2011 at 5:16 PM
Superb website…
[...]always a big fan of linking to bloggers that I love but don’t get a lot of link love from[...]……
October 21st, 2011 at 8:20 PM
Medical Marijuana Dispensaries…
[...]the time to read or check out the content or pages we have linked to underneath the[...]…
October 22nd, 2011 at 8:12 AM
Related……
[...]just beneath, are numerous totally not related sites to ours, however, they are surely worth going over[...]……
October 22nd, 2011 at 8:30 AM
Websites we think you should visit…
[...]although websites we backlink to below are considerably not related to ours, we feel they are actually worth a go through, so have a look[...]……
October 22nd, 2011 at 10:34 AM
Superb website…
[...]always a big fan of linking to bloggers that I love but don’t get a lot of link love from[...]……
October 23rd, 2011 at 1:37 AM
Websites worth visiting…
[...]here are some links to sites that we link to because we think they are worth visiting[...]……
October 23rd, 2011 at 11:06 AM
Bored at work…
I like to surf around the web, regularly I will go to Stumble Upon and follow thru…
October 23rd, 2011 at 1:58 PM
Visitor recommendations…
[...]one of our visitors recently recommended the following website[...]……
October 23rd, 2011 at 8:15 PM
Sources…
[...]check below, are some totally unrelated websites to ours, however, they are most trustworthy sources that we use[...]……
October 24th, 2011 at 4:00 AM
Trackback…
[...]Sites of interest we have a link to[...]……
October 24th, 2011 at 3:58 PM
Marijuana News …
[...]while the web sites we link to below are completely unrelated to ours, we think they are worth a read, so have a look[...]…
October 24th, 2011 at 5:09 PM
Sources…
[...]check below, are some totally unrelated websites to ours, however, they are most trustworthy sources that we use[...]……
October 25th, 2011 at 2:28 AM
Links Trackback…
[...]Sites of interest we have a link to[...]……
October 25th, 2011 at 4:24 AM
Related……
[...]just beneath, are numerous totally not related sites to ours, however, they are surely worth going over[...]……
October 25th, 2011 at 7:43 AM
Check this out…
[...] that is the end of this article. Here you’ll find some sites that we think you’ll appreciate, just click the links over[...]……
October 25th, 2011 at 3:40 PM
Sites we Like……
[...] Every once in a while we choose blogs that we read. Listed below are the latest sites that we choose [...]……
October 25th, 2011 at 4:02 PM
Sites we Like……
[...] Every once in a while we choose blogs that we read. Listed below are the latest sites that we choose [...]……
October 26th, 2011 at 2:51 AM
Online Article……
[...]The information mentioned in the article are some of the best available [...]……
October 26th, 2011 at 3:59 AM
Websites worth visiting…
[...]here are some links to sites that we link to because we think they are worth visiting[...]……
October 26th, 2011 at 4:15 AM
Related……
[...]just beneath, are numerous totally not related sites to ours, however, they are surely worth going over[...]……
October 26th, 2011 at 5:00 AM
Links…
[...]Sites of interest we have a link to[...]……
October 26th, 2011 at 6:51 AM
Gems form the internet…
[...]very few websites that happen to be detailed below, from our point of view are undoubtedly well worth checking out[...]……
October 26th, 2011 at 7:23 AM
Websites worth visiting…
[...]here are some links to sites that we link to because we think they are worth visiting[...]……
October 26th, 2011 at 8:36 AM
Related……
[...]just beneath, are numerous totally not related sites to ours, however, they are surely worth going over[...]……
October 26th, 2011 at 9:36 AM
Links…
[...]Sites of interest we have a link to[...]……
October 26th, 2011 at 10:38 AM
Websites you should visit…
[...]below you’ll find the link to some sites that we think you should visit[...]……
October 26th, 2011 at 2:35 PM
Superb website…
[...]always a big fan of linking to bloggers that I love but don’t get a lot of link love from[...]……
October 26th, 2011 at 4:47 PM
Blogs ou should be reading…
[...]Here is a Great Blog You Might Find Interesting that we Encourage You[...]……
October 26th, 2011 at 6:01 PM
Websites we think you should visit…
[...]although websites we backlink to below are considerably not related to ours, we feel they are actually worth a go through, so have a look[...]……
October 26th, 2011 at 7:09 PM
Great website…
[...]we like to honor many other internet sites on the web, even if they aren’t linked to us, by linking to them. Under are some webpages worth checking out[...]……
October 27th, 2011 at 4:22 AM
Superb website…
[...]always a big fan of linking to bloggers that I love but don’t get a lot of link love from[...]……
October 27th, 2011 at 5:20 AM
Related……
[...]just beneath, are numerous totally not related sites to ours, however, they are surely worth going over[...]……
October 27th, 2011 at 6:16 AM
Related……
[...]just beneath, are numerous totally not related sites to ours, however, they are surely worth going over[...]……
October 27th, 2011 at 7:18 AM
Check this out…
[...] that is the end of this article. Here you’ll find some sites that we think you’ll appreciate, just click the links over[...]……
October 27th, 2011 at 8:23 AM
Websites we think you should visit…
[...]although websites we backlink to below are considerably not related to ours, we feel they are actually worth a go through, so have a look[...]……
October 27th, 2011 at 8:43 AM
Related……
[...]just beneath, are numerous totally not related sites to ours, however, they are surely worth going over[...]……
October 27th, 2011 at 10:36 AM
Read was interesting, stay in touch……
[...]please visit the sites we follow, including this one, as it represents our picks from the web[...]……
October 27th, 2011 at 10:47 AM
Links…
[...]Sites of interest we have a link to[...]……
October 27th, 2011 at 11:42 AM
Great website…
[...]we like to honor many other internet sites on the web, even if they aren’t linked to us, by linking to them. Under are some webpages worth checking out[...]……
October 27th, 2011 at 12:16 PM
Visitor recommendations…
[...]one of our visitors recently recommended the following website[...]……
October 27th, 2011 at 12:22 PM
Websites we think you should visit…
[...]although websites we backlink to below are considerably not related to ours, we feel they are actually worth a go through, so have a look[...]……
October 27th, 2011 at 5:25 PM
Cool sites…
[...]we came across a cool site that you might enjoy. Take a look if you want[...]……
October 27th, 2011 at 6:40 PM
Recommeneded websites…
[...]Here are some of the sites we recommend for our visitors[...]……
October 27th, 2011 at 11:30 PM
Another Title…
I saw this really good post today….
October 28th, 2011 at 1:53 AM
Blogs ou should be reading…
[...]Here is a Great Blog You Might Find Interesting that we Encourage You[...]……
October 28th, 2011 at 2:52 AM
Links…
[...]Sites of interest we have a link to[...]……
October 28th, 2011 at 6:08 AM
Awesome website…
[...]the time to read or visit the content or sites we have linked to below the[...]……
October 28th, 2011 at 8:43 AM
Sites we Like……
[...] Every once in a while we choose blogs that we read. Listed below are the latest sites that we choose [...]……
October 28th, 2011 at 10:43 AM
Great website…
[...]we like to honor many other internet sites on the web, even if they aren’t linked to us, by linking to them. Under are some webpages worth checking out[...]……
October 28th, 2011 at 2:46 PM
Websites we think you should visit…
[...]although websites we backlink to below are considerably not related to ours, we feel they are actually worth a go through, so have a look[...]……
October 28th, 2011 at 3:34 PM
Online Article……
[...]The information mentioned in the article are some of the best available [...]……
October 28th, 2011 at 5:27 PM
Cool sites…
[...]we came across a cool site that you might enjoy. Take a look if you want[...]……
October 28th, 2011 at 10:36 PM
Another Title…
I saw this really great post today….
October 29th, 2011 at 12:20 AM
Blogs ou should be reading…
[...]Here is a Great Blog You Might Find Interesting that we Encourage You[...]……
October 29th, 2011 at 4:31 AM
Sites we Like……
[...] Every once in a while we choose blogs that we read. Listed below are the latest sites that we choose [...]……
October 29th, 2011 at 7:14 AM
Sites we Like……
[...] Every once in a while we choose blogs that we read. Listed below are the latest sites that we choose [...]……
October 29th, 2011 at 8:10 AM
Cool sites…
[...]we came across a cool site that you might enjoy. Take a look if you want[...]……
October 29th, 2011 at 8:50 AM
Read was interesting, stay in touch……
[...]please visit the sites we follow, including this one, as it represents our picks from the web[...]……
October 29th, 2011 at 11:05 AM
Online Article……
[...]The information mentioned in the article is some of the best available [...]……
October 29th, 2011 at 11:50 AM
Online Article……
[...]The information mentioned in the article are some of the best available [...]……
October 29th, 2011 at 5:00 PM
Recent Blogroll Additions……
[...]usually posts some very interesting stuff like this. If you’re new to this site[...]……
October 29th, 2011 at 6:53 PM
Links…
[...]Sites of interest we have a link to[...]……
October 30th, 2011 at 7:10 AM
Blogs ou should be reading…
[...]Here is a Great Blog You Might Find Interesting that we Encourage You[...]……
October 30th, 2011 at 8:23 AM
Gems form the internet…
[...]very few websites that happen to be detailed below, from our point of view are undoubtedly well worth checking out[...]……
October 30th, 2011 at 10:18 AM
Read was interesting, stay in touch……
[...]please visit the sites we follow, including this one, as it represents our picks from the web[...]……
October 30th, 2011 at 1:52 PM
Online Article……
[...]The information mentioned in the article are some of the best available [...]……
October 30th, 2011 at 3:21 PM
Related……
[...]just beneath, are numerous totally not related sites to ours, however, they are surely worth going over[...]……
October 30th, 2011 at 5:16 PM
Great website…
[...]we like to honor many other internet sites on the web, even if they aren’t linked to us, by linking to them. Under are some webpages worth checking out[...]……
October 31st, 2011 at 5:26 PM
Recent Blogroll Additions……
[...]usually posts some very interesting stuff like this. If you’re new to this site[...]……
November 1st, 2011 at 3:37 PM
Looking around…
While I was browsing today I noticed a great post about…
November 1st, 2011 at 4:12 PM
Links…
[...]Sites of interest we have a link to[...]……
November 2nd, 2011 at 5:34 AM
Websites you should visit…
[...]below you’ll find the link to some sites that we think you should visit[...]……
November 2nd, 2011 at 9:57 AM
Wika linked to this {site|website|place}…
I was reading the news and I saw this really interesting info…
November 2nd, 2011 at 5:10 PM
Websites worth visiting…
[...]here are some links to sites that we link to because we think they are worth visiting[...]……
November 2nd, 2011 at 5:16 PM
Superb website…
[...]always a big fan of linking to bloggers that I love but don’t get a lot of link love from[...]……
November 2nd, 2011 at 6:15 PM
News info…
I was reading the news and I saw this really interesting information…
November 2nd, 2011 at 6:15 PM
Websites worth visiting…
[...]here are some links to sites that we link to because we think they are worth visiting[...]……
November 2nd, 2011 at 6:58 PM
Websites we think you should visit…
[...]although websites we backlink to below are considerably not related to ours, we feel they are actually worth a go through, so have a look[...]……
November 2nd, 2011 at 7:14 PM
Blogs ou should be reading…
[...]Here is a Great Blog You Might Find Interesting that we Encourage You[...]……
November 2nd, 2011 at 11:05 PM
Its hard to find good help…
I am constantnly saying that its difficult to find good help, but here is …
November 2nd, 2011 at 11:06 PM
Blogs ou should be reading…
[...]Here is a Great Blog You Might Find Interesting that we Encourage You[...]……
November 3rd, 2011 at 6:04 AM
Visitor recommendations…
[...]one of our visitors recently recommended the following website[...]……
November 3rd, 2011 at 7:48 AM
Related……
[...]just beneath, are numerous totally not related sites to ours, however, they are surely worth going over[...]……
November 3rd, 2011 at 10:32 AM
Sources…
[...]check below, are some totally unrelated websites to ours, however, they are most trustworthy sources that we use[...]……
November 3rd, 2011 at 11:51 AM
Links…
[...]Sites of interest we have a link to[...]……
November 3rd, 2011 at 12:47 PM
Sources…
[...]check below, are some totally unrelated websites to ours, however, they are most trustworthy sources that we use[...]……
November 3rd, 2011 at 1:41 PM
Websites worth visiting…
[...]here are some links to sites that we link to because we think they are worth visiting[...]……
November 3rd, 2011 at 7:19 PM
Great website…
[...]we like to honor many other internet sites on the web, even if they aren’t linked to us, by linking to them. Under are some webpages worth checking out[...]……
November 4th, 2011 at 10:19 AM
Related……
[...]just beneath, are numerous totally not related sites to ours, however, they are surely worth going over[...]……
November 4th, 2011 at 6:04 PM
Online Article……
[...]The information mentioned in the article are some of the best available [...]……
November 5th, 2011 at 8:57 AM
Sources…
[...]check below, are some totally unrelated websites to ours, however, they are most trustworthy sources that we use[...]……
November 5th, 2011 at 11:06 AM
Read was interesting, stay in touch……
[...]please visit the sites we follow, including this one, as it represents our picks from the web[...]……
November 5th, 2011 at 6:25 PM
Bored at work…
I like to browse around the web, regularly I will go to Digg and read and check stuff out…
November 5th, 2011 at 8:16 PM
Read was interesting, stay in touch……
[...]please visit the sites we follow, including this one, as it represents our picks from the web[...]……
November 6th, 2011 at 12:57 AM
Useful Suggestions….
[...]Check my article. I’d like to hear your opinion on that[...]…
November 6th, 2011 at 5:29 AM
Related……
[...]just beneath, are numerous totally not related sites to ours, however, they are surely worth going over[...]……
November 6th, 2011 at 3:12 PM
Check this out…
[...] that is the end of this article. Here you’ll find some sites that we think you’ll appreciate, just click the links over[...]……
November 6th, 2011 at 3:14 PM
Check this out…
[...] that is the end of this article. Here you’ll find some sites that we think you’ll appreciate, just click the links over[...]……