The Housing Bubble

Good morning. Europe turned around at mid-day and is now up. I will guess that US markets will be up today.

Some auto sales data coming out today. That could reaffirm the fear that everyone forgot overnight.

Sigh.

Today I fear bad news IS bad news for the market.

Fed purchasing paper, Sears down, Beaser 4Q down, global markets down (look surprised).

Oh, and let’s not forget Goldman -2B and oil below 50.

20 minutes to opening bell.

Pray I’m wrong,
Leigh

A 14 day stochRSI has been giving on the money buy/sell signals for the last 2 months. It doesn’t always work, however.

It’s funny how recently made new lows go unmentioned. Remember when everyone was arguing October’s low was the bottom? Today’s argument is November’s low is the bottom.

I don’t want to make any general investment strategy to anyone but one should remember to do the reverse of what everyone else is doing in the market when the emotions (ie volatility) runs high. When everyone is running away from volatility, you run to volatility.

Something like, when the VIX is very high, be the seller of volatility via shorting puts on stocks highly correlated to SP500 and hedge with a small portion of double inverse SP500. You earn the high put premiums while protected against complete market collapse. Example: sell at-the-money Verizon puts for one month, earn 8% in premium for one month, take on SDS at 25-30% of your put contract notional values. Repeat every month. If you put on your off-setting positions correctly, you can easily earn double digits return with very low correlation to the overall market. It’s been working quite well for me.

In this type of market, naked longs or shorts have too much risk. Off-setting positions while earning high volatility premium is the way to go.

Road-building? Infrastructure projects? Pelosi and the wacky liberals DO have a recovery plan: The government will bail out itself.

“expanding social programs”

They JUST. DON’T. GET IT. Cut back, you turds! Pelosi wants to expand social programs, let her do it out of her own pocket. Lady Bountiful Impeachment Is Off The Table. .

they like to use the new deal as an example of CREATING jobs
it failed completely in 1937

$ + labor + job

PLEASE DEAR GAWD SEND SOME $$$ TO NYC we need that damn 2nd ave subway built 30 years ago put people to work and build this damn thing in 2 years not 10

Sardine city yesterday on the 6 train broke down all passengers told to get off then wait for 4 jam packed subways to pass before squeezing into a car

2nd proposal, lots of people like working 2nd 3rd shift holidays and weekends, so lets give tax breaks to companies that create these kinds of jobs …sort of like congestion pricing ZERO breaks if all your employees work M-F 9-5.

RE: Roadwork?

Yeah, I can’t fathom all this BS about “jobs creation” related to infrastructure spending.

So, the bridge is repaired in a couple years years…then what?

And all the blather about “green work”.

WTF is that is suppose to be? Planting new grass on the courtyards of inner city housing projects?

wmbz,

WPA Part II?

( One of my favorite commentators uses the phrase “moonbats” too )

“…the association’s proposal, which seeks at least $126 billion of federal funding to help states pay for…expanding social programs…”

When comparing this current episode with the Great Depression it is helpful to remember that today, unlike back then, we already have healthy headstart in entitlement spending.

Oh, what’s that you say? We’ve spent so much on these wars that we should now spend more here at home?

That might be the popular tune right now, but the meter’s still running on the wars. Has a real exit strategy even been discussed?
Just because they’ve been wiped off the front page doesn’t mean the damage has been undone.

If they are going to infrastructure jobs, why are they doing road work? Many state projects already do that. Why not do something for American Public schools. Upgrade some of their facilities. Hire a bunch of teachers. Increase the amount of rooms (not students in the rooms), hire teachers, aids, athletic personnel for afterschool activities. We can help america build for the future. my thoughts.

“The economic slump is too hard for anyone to fix right away,” said Tetsushi Nagato of Schroder Investment Management Japan Ltd., whose parent manages the equivalent of $205 billion.”

Wish my parent had managed the equivalent of $205 billion.

Don’t worry. The snake can eat its own tail!

When the market opens we want you to buy all the … you can. Don’t worry if the price goes up, just keep buying.

But gentlemen, they’re going to broadcast the crop report in an hour.

Let us worry about that.

http://www.bloomberg.com/apps/news?pid=20601068&sid=aJ_MDvdVgo8s

Bernanke Says Fed May Buy Treasuries to Aid Economy (Update3)

Dec. 1 (Bloomberg) — Federal Reserve Chairman Ben S. Bernanke said he has “obviously limited” room to lower interest rates further and may use less conventional policies, such as buying Treasury securities, to revive the economy.

One option is for the Fed to buy “longer-term Treasury or agency securities on the open market in substantial quantities,” Bernanke said. “This approach might influence the yields on these securities, thus helping to spur aggregate demand.”

Treasury prices rose on Bernanke’s remarks, with yields on 10-year Treasuries tumbling 25 basis points to a record low of 2.67 percent at 2:31 p.m. in New York, according to BGCantor Market Data. The yield was the lowest since daily Fed records started in 1962 and the least since 1955 as measured on a monthly basis. One basis point is equal to 0.01 percentage point.

While the Governator is wringing his hands saying Cali could run out of money by next year. I posted the article, but the system is having it for breakfast right now.

Translation: Last month, we sold 1 house.
This month, we sold 2!

Before employed people take mandatory pay cuts (which may be necessary), I want to see entitlements to illegal immigrants eliminated completely.

Also, California needs to make it even more expensive to drive here. Something like a buck-a-gallon gas tax just to pay down the deficit.

It seems like since forever people talked and talked about a tax revolt to force government to shrink by cutting off the money, starving the beast.. But they never had the will to do it.

Then, one day, it happened by accident.

Still plenty to be done here. I have heard talk of sales tax increase, which will most likely fail since taxable purchases are way down and a 20 - 40 cent gas tax (per gallon). And of course our fines for parking, traffic etc are way too low. These are great since the police can be used to arrest you if you don’t pay. Moa PowAA!

See the USA
In your Chevrolet

Where’s laddie? He did a great update of that little ditty, one of the funniest things I ever read.

I have a relative that sold her VW Diesel last week and bought a brand new…… Chevy Subdivision! Because, gas is so cheap now and they need the room.

If you don’t believe that there is actually a gas shortage (I’m not sure) then it only makes sense that gas is cheaper today then it was in 1935. Transportation is better, refineries are better (both are MUCH more automated, requiring far fewer people), drilling techniques are better, etc, etc, etc..

The only thing that would make gas prices go up is an actual shortage of crude. I don’t think that we have a shortage of crude (yet); so, it only makes sense that the prices are, inflation adjusted, falling.

It’s the same thing as housing. It’s cheaper to build a house today (inflation adjusted) then it was 100 years ago. So, like all things, the price of housing should fall (if there’s no shortage of raw materials and land) over time, not go up.

The running out of land argument is just insane. I’ve said many times, I was told (in Palm Beach) that we were running out of land by RE agents standing in VACANT lots right next to the condo towers we were walking through. But, even more extreme, go into the middle of the country. We are FLOODED in land supply, there’s a massive glut of land. And therefore, it makes sense that, over time, home prices will fall (regardless of the bubble).

I filled up for $1.62/gal in St. George, UT on Sunday night at a Chevron. Here in Palmdale this morning it was $1.82.

In our part of upstate SC the price was as low as $1.67 point nine yesterday. But I noticed a huge difference in the price of midgrade (plus 20 cents) and premium (another 20 cents).

Also, why is Diesel fuel a buck a gallon higher? I feel sorry for truckers and those who have Diesel cars.

It’s 1.61 here today in Fort Worth, TX. I here it’s lower than 1.50 in parts of Houston.

Over the past few years I’ve noticed that the price of gas falls right before Christmas. I think they do this to get the mopes to buy more junk from retailers. Then it starts moving upwards in january. It will happen again this year.

Yesterday gas was 1.57 in Greer, SC

Gas is $1.69 here in Boise.

My dad said that gas was 10 gallons for $1 right after WWII.

Gasoline prices fall below 1935 levels!..Adjusted for inflation This sort of calculation ignores the role of petro prices on general price levels. It is like saying “Adjusted for inflation, prices haven’t ever changed.”

Wow, now they have an “expert” on. She’s telling me to make sure I don’t pay for services I don’t use.

Wait, so if I don’t use it, don’t buy it??

Breaking news: don’t bounce checks!

(drools…)

Is that the scary woman who home schools all the kids so they won’t go out into the big bad world and be exposed to any nasty, icky things like…oh, I don’t know…facts?

And the older kids all have to basically parent the younger ones because there are so damn many of them? But they’ll just keep having “as many children as the good Lord sends to us.”

Those people give me the heebie-jeebies, big-time.

It drives me buggy when unions and pay for middle america is attacked nonstop for the situations we are all in. It ain’t the unions fault. Since every dang thing has been deregulated, the only ones who are responsible for wreaking havoc on our state or the state of our union nationally and now worldwide is because of wallstreet and thugs,lobbyists who take take take.
Now tell me this, if unions were to take a minimum of 50% haircut$, WHO would be supporting this stupid false economy anyway? hmmm? No one making 21K pr yr would be able to afford cars,houses,big screen tvs, plane trips/vacations,clothes, dining out etc.
So do not go blaming unions when the problem starts at gov and goes right through wallstreet and the scum who want theirs but dont’ want anyone to have an equal share.

Having already gotten no pay raise since 1983, then getting a 35% negative haircut 5 yrs back, dont’ tell me my industries problems are because of MY pay level. Sheesh.
And gosh omighty, what about the auto ceos who paid themselves mightily WITH jets etc?
What about the HUGE discrepancy amongst all CEO’s pay and the rest of the company they choose to ruin?

And here I am hoping for a reprise of the Chevrolet ditty. Come on, laddie, how did that go?

Watch your Chevrolet
Stock decay in your 401K
In the USA

Wuz that it?

Thanks for getting me into the spirit of Christmas giving

Last November, someone posted a HBB version of The Night Before Christmas. Does anyone recall this?

“…32% believed it was a good time to invest in stocks — but 51% said it was a good time to buy a home…”

Contrarian analysis would suggest it is a better time to invest in stocks than housing at the moment. My hunch is that stock market sentiment will bottom out long before housing market sentiment does — just like last time there was a real estate bust in the early 1990s.

Like I keep saying PB. Its early.

Buying a house is to investing as:

A.) buying food for the refrigerator and freezer is to saving.

B.) turning off the lights is to tax evasion

C.) mowing the lawn is to portfolio management

D.) All of the above

E.) None of the above

Oopsy… old data. I nary forgot we’re in December. NY’s Nov numbers should be out today or tomorrow.

http://biz.yahoo.com/ap/081202/earns_beazer_homes.html?.v=10

I’ve long wondered why we don’t hear about more HB BKs. Totally mystifying. And if the banks are still lending to these assclowns, they deserve to go bust instead of being bailed out.

Yet their billboards are still ubiquitous.

“When is the best time to buy a Beazer home? NOW!”

Yeah…sure.

“Everything but income went up in the last 10 years for most people in America, but nobody noticed or asked how people were paying for things.”

When I starting seeing the field workers around here driving new cars to work instead of car pooling in vans, thats when I noticed. It took me quit a while to figure out how they were getting the money. It was just to unbelievable to me that Bankers would extend that much credit to minimum wage workers. Know I along with everyone else knows they were selling these loans overseas. I honestly understand your frustration with these aholes trying to plug holes with crooked pinkies!

Hmm. Last recession that hit Montana bad, in the 80s, saw people moving to Cali for work. Kinda miss those days, but I can’t belive it’s already happening again.

“was the huge number of out-of-state cars”

I’ve been seeing this here in Bakersfield for a few months now. I wish someone would post huge signs on the city limits “No Workers Needed, Keep Driving to the Next Town”. This is the truth, the classifieds get smaller each week.

huh….my niece drove back up here (Portland) from LA on Sunday/Monday–she said the traffic heading out of LA on Sunday was insane, all the way up into the central valley.

Ahh, this is no fun, hopping into boxcars - now there’s some romance to that. Ya, can’t have a depression driving around in a Suburban.

Bookman’s never looks busy, and it always seems like everyone is just reading, not buying. The place has still been there for way longer than most Flag businesses.

RE: Poor Ben B., soon to be just another statistic of the Great Depression, version 2.009

Beantown Glob and associate TV media types are actually giving people the impression that this debacle will all be over in the 2nd quarter of ‘09, based on the durations of the ‘73/’74- ‘80/’81 busts.

Not a fookin’ chance.

‘29 crash ran for 43 months which much more probable.

“Bernanke, working closely with Henry (Hank) Paulson, the Treasury Secretary, a voluble former investment banker, was determined to keep the financial sector operating long enough so that it could repair itself—a policy that he and his Fed colleagues referred to as the “finger-in-the-dike” strategy.”

What as it Tony Montana said about that?

…the drug-related violence that’s plagued South Florida…It seems at times all you can do is put your finger in the dike and pray.

“Put your fingers in a dike? The only place you can get your fingers
is in some dyke.”

–The Federal Reserve is a monopoly Money pusher. Guess they forgot to spray those dollar bills with more cocaine, and the fiat money high buzz is wearing off.

Good for her. Always tough to say no to a loved one (although some are easier than others.) But in the long run not being bailed out will be better for him. Now if we could only get her elected to Congress to vote no on some other bailouts.

From your lips to God’s ears, laddie. I have developed the utmost contempt not only for the financial class, but for the political class. Seething, spit on the floor contempt.

Geithner for Treasury Secretary. Feh. Puh. Lungie.

I’m worried about where all the quants are going to end up. What industry will they go to and will it help or hurt that/those industries?

In my mind they will add value to other industries until management let’s them go too far, like they did in finance.

Or, since they’ve all gotten a taste for money and instead of becoming engineers and adding value to society, they will instead continually look for minute arbitrage opportunities in every market and become sophisticated, quantitative day-traders (wearing their bathrobe and slippers).

OK - not sure I understand.

30-year treasuries are at about 4.5% right now. How could they be performing according to the numbers stated above?

Unless you can come of a plausible scenario by which households can borrow more money without going through bankruptcy first, and service both the current debt and future debt, I foresee a Japan in the US’s future.

“…It is just as important that inflation expectations remain well anchored in the face of falling energy prices. Significant declines in gasoline and fuel oil prices, for instance, have recently led to declines in the consumer price index. This has prompted some commentators to suggest that the U.S. is facing a threat of sustained deflation, as we did in the Great Depression or as Japan faced for a decade. I do not believe this is a serious threat. Although the recent dramatic declines in energy prices have led to declines in the monthly headline CPI, it still increased 3.7 percent over the last 12 months while core CPI increased 2.3 percent. So we are not close to a sustained deflation. The recent declines are simply the mirror image of the increases we saw earlier in the year. As long as inflation expectations remain well anchored, these declines in energy prices are unlikely to lead to sustained deflation any more than their previous increases were likely to lead to sustained inflation…”
Mr Charles I. Plosser, President and Chief Executive Officer
Federal Reserve Bank of Philadelphia
Dec 2, 2008

As Mr. Plosser says, “So we are not close to a sustained deflation.”

In sum, the subject is boring. I have made my investments and will change them if there is ever evidence of deflation.

This got me thinking about how rare it is today to see a late model car broken down on the road side. I recall in the late 60’s, 70’s and even the 80’s it was not an uncommon thing to see.

I’m sure that his Malibu hybrid will get to DC just fine.

I can tell you how to restore a Dell computer back to brand new , but you lose everything .

Have you tried installing and running “Malwarebytes’ Anti-Malware”?

IT people won’t want to hear me give you this advice, but I say do a system restore to a point in time that you know was virus-free.

How do you know you have this virus? I’m just curious, but except for sudden extreme changes in computer behaviour, I’m not really sure how they manifest.

Go to Microsoft dot Com and search for “Malicious Software Removal Tool”. It is free.

I would go also download and run a firewall ( there are are free ones like zonealarm dot com) to help keep the nasties out.

Lastly, buy a cheap router and connect it between your dsl/cable/etc and your computer.

AVG works also nod32.

The story mentioned that employment of part time port workers has gone from 4-5 shifts per week (16-20 per month) to 1-2 shifts per month — a drop off of about 90 pct which conspicuously resembles the percentage decline in the Baltic dry index this year.

There was an article about how auto importers (Asian & European) are scrambling to find lots to keep the excess inventory that keeps arriving but the dealers won’t accept for delivery. Apparently Mercedes has cars that have been in storage for over 6 months.

“We’re different!”

We are not…

Do there exist any remaining fools in the Alt-A Bay Area ready to state that this recession is not having an impact on behavior or prices (for almost anything) in their neighborhood?

*****

Porsche U.S. November sales drop 48.2%

By Wallace Witkowski
Last update: 12:12 p.m. EST Dec. 2, 2008

SAN FRANCISCO (MarketWatch) — Porsche (DE:PAH003:porsche
DE:PAH003 46.15, -1.30, -2.7%) said Tuesday that November U.S. sales fell 48.2% to 1,378 vehicles from 2,662 vehicles a year ago. U.S. November Boxster and Cayman sales fell to 153 vehicles from 580 last year, and Cayenne sales fell to 700 vehicles from 1,232 last year.

http://www.marketwatch.com/news/story/Porsche-US-November-sales-drop/story.aspx?guid=%7B1138CE90%2DC6F4%2D43CC%2DB43D%2D81BF3109250B%7D

Here is a quote from a man after my own heart.

Other experts are not so sure. “I wouldn’t bail out people who made stupid mistakes,” says Kent Smetters, professor of insurance and risk management at Wharton, arguing that borrowers and lenders should suffer the consequences of risks gone bad. Trying to mitigate the consequences won’t stop the financial train wreck, just shift it to slow motion, he argues. “The alternative is to say we’re going to let the train wreck happen. What that does is to allow us to clear the tracks sooner.”

Beware the static analysis trap. If demand exists, then someone somewhere will be the supplier.

Hey Lad,

What do you think of the idea of seeding the ocean with Iron chelate (rust) to enhance transpiration due to algae growth, thus increasing rainfall. Preliminary testing of this idea in the south pacific has shown promising results.

Tell us what you really think of the voting public, Harry.

It’s ok, the next election is still two years off.

Priceless. I’ve always said that Harry Reid goes around with an “I smell sh*t” look on his sour old puss.

Lol, he acts like in Washington, no one’s sh*t stinks, but those outside of the bounds of Rome are ripe and fetid. Figures.

mmmmmm….cake.

Total side note - I always think statements like this are funny:

“Many analysts expect the oil price to drop further.”

No duh. Being that the price of something is generally the mid-point between people that think the price will increase vs. people that think the price will decrease - that will always be a true statement. Just as true would be the statement “Many analysts expect the oil price to stop falling and to rise.”

I was one of the PO proponents who fervently hoped and predicted that the credit bubble would implode in time to put a hold on growth.

I certainly think the mini-bubble in commodities due to increasing energy cost was a big part of what caused the precipitous collapse of the credit bubble.

Most people who understand markets and believe PO is real see this price drop as temporary, but I’ll bet it lasts at least as long as the depression just commenced.

My inner-trader is just itching to buy some oil at these prices, but so far I’ve managed to resist the urge. As I’ve stated before, I’m quiet frequently correct, and more frequently early, in my prognostication.

Peak oil is here Professor Bear. What else could it be? After all, we’re running out of land, gold, food, water and everything else imaginable.

I think your quote answered your question

“The latest drop came after members of OPEC, who had gathered for an emergency meeting in Cairo at the weekend, failed to agree to cut output quotas, despite tumbling demand. ”

Maybe we’ve seen peak consumption.

Additional observation - other areas that hadn’t been considered bubbles at all, since prices didn’t rise significantly above inflation - e.g. Atlanta and St. Louis, now are also seeing significantly falling prices.

Many on here have predicted fallout to non-bubble areas. That prediction is now proving true.

And poor Seattle - the last big bubble holdout - is finally succumbing. Prices are now falling at about 8% annual rate, with the rate of fall increasing rapidly - same as has happened to all bubble areas, generally falling at 20-40% annually now since they’re further along the curve.

More observation (I’m an excel junkie) -

The average for all of the U.S. areas is now falling faster on the back end of the bubble, than it rose on the front end. This is true even in non-inflation-adjusted terms.

Thus the bubble is bursting faster than it inflated, by a fair amount. This, combined with the fact that some of the most bubbly areas (CA central valley, FL west coast) are already diving below their inflation-adjusted “normal” indexes, or are obviously going to dive below them within the next couple of quarters, indicates to me that the U.S. overall will be overshooting our home prices on the downside.

This is also supported by the census data indicating that we have yet to make a dent in the overhanging inventory - it remains at peak levels, despite the now-record-low level of new homebuilding. Obviously this is due to foreclosures. This data indicates that home price declines will continue at their current rate for probably 12-18 more months, before slowing the rate of decline.

End conclusion is - we are still in the very early stages of this downturn. While the housing downturn may not get worse in terms of the rate of price declines - it will get a lot worse still in terms of actual prices, and therefore in terms of the number of underwater mortgage holders. Thus I think the bulk of the pain with regards to revenue and profit losses, job losses, and consumer spending is still ahead of us.

GE up big on news their dividend will be unchanged. Also Bernanke with more innuendo about using more of our money to fill the bankers’ troughs.

Love to hear your views on the Mumbai situation, AB. You’ve said you travel there a bit.

What about those of us who don’t do facebook?? I’ve always thought facebook, myspace etc. was a complete waste of time. have never even looked at them.

“Bernanke is making Jas Jain look like the true genius among HB Bloggers.”

Did Jas predict quantitative easing? I don’t recall…

I thought he was predicting true deflation, and my take is that the jury is still out on that.

“They have collapsed the yield curve.”

just wait and they will collaspe the dollar, remember Japan kept their yen low doing this kind of trick and created the yen carry trade which many beleive helped cause the US RE bubble.

Free money from Japan so why not borrow and buy US RE for any price, it was very inflationary but not in Japan.

Maybe the US will export any re-inflation attempt as banks don’t like USA borrowers anymore and decide to lend to…. ?

Indeed, where were the pay raises that matched worker bee productivity gains?

The article might as well have said (in a whiney voice): “Awwwww, c’mon, borrow more money you know you can’t pay back”

I read that article this morning. That has to be the most pathetic trash I’ve read in an awful long time. Good going NYT.

The only positive about reading it is that it may help some to see what a lap dog the MSM is to the PTB.

here’s a couple of questions, hozzie.

Why is Paulson heading to China?

why the blowout on the CDS in US and UK?

“Five-year CDS on UK government debt jumped 7 basis points to a record 106.4 basis points while the 10-year U.S. Treasury CDS hit a record 66.4 basis points, up two basis points on the day, credit data company CMA DataVision said.

That means it costs 106,400 pounds per year to insure 10 million of UK government bonds against default and $66,400 per year against the United States defaulting on its 10-year debt.”

In both cases the underlying currency is the denomination of the bonds in question. How is a default even possible?

Folks, this is about to become un-fricken-glued. Something very sinister is lurking, and a BK by one or multiple automakers may be the trigger.

want another question?

http://money.cnn.com/2008/12/02/news/companies/AIG/index.htm

“NEW YORK(CNNMoney.com) — Troubled insurer American International Group moved another step closer to stabilizing its finances on Tuesday.

The company announced that a financing entity — funded by the Federal Reserve Bank of New York and AIG — has purchased $46.1 billion in complex debt securities insured by AIG. As part of the deal, the insurance-type contracts, called credit default swaps, were terminated.”

Does this smell funny?

jeez cant even get a comment in.

“Neo Liberals” what on earth is a Neo liberal ?

ITs all there. Where is transparency, disclosure, and full understanding MISSING?

“In my view, the true reasons for the unwillingness of the central banks to make public the identities of the banks using their liquidity or lending facilities have nothing to do with stigma. For the banks, commercial confidentiality is an overriding concern. They see the revelation of the identities of banks borrowing from the central bank as the thin end of the wedge towards more onerous reporting and audit obligations. Even if shareholders might be interested, management and captive boards would not be, as it would dilute their discretion to manage the bank for their own purposes.

There are wider political externalities associated with accepting ’stigma’ as an argument for hiding relevant information about the use of public resources. It would create a dangerous precedent as regards accountability for the use of public resources in other areas than liquidity support by the central bank. I am sure many other beneficiaries of state’s financial largesse would prefer to have their names kept out of the papers. They should not be granted this wish. Accountability for the use of public funds is well worth a bit of stigma.

For the central banks, the refusal to reveal the identities of the borrowers is partly just the manifestation in this particular setting of a long-standing central bank obsession with secrecy and confidentiality. This goes back to the period of central bankers as performers in quasi-religious mysteries, with central banks as their temples. Significant remnants of this ethic can still be found on the European continent and in the US - less so in the UK.

Many central banks are also far too close to the banks they deal with - they have been the objects of cognitive regulatory capture or other forms of regulatory capture. As a result they tend to act as advocates or lobbyists for the banking sector rather than as supervisors, regulators and sources of scarce public funds that have to be properly accounted for.

In addition, revealing the identities of the borrowing banks is likely to be seen by the central banks as part of a political drive towards greater accountability by the central banks for their use of public resources - as asset managers or indeed as portfolio managers. Central banks rightly fear that the pursuit of their traditional objectives - price stability (or price stability and full employment) and financial stability - could be impaired by too close a scrutiny of their performance as managers of ever larger and ever more risky portfolios of public and private securities. Well, welcome to the 21st century world of central banking.”\\

———
from naked capitalism.

Now he wants to be SEC chairman.

Maybe he could go to work for Bernanke and company?