Greenspan says the first hike is always complicated because the market will try to figure out whats is likely to be the entire tightening cycle and price that in. So if the Fed wanted to give a little juice to main street and prenvent some MM funds from going broke, that might turn out to be some expensive juice
I'm not sure the market will take seriously a claim that 'guys were are only hiking a bit, dont worry about it', more like people will think a new cycle has started and the fed is about to dump $1T of assets in the market
'On the Brink' hits US stores today, I will get the audio version through audible.com when its avaliable
One thing that can be taken out of the reports about that book is that apparently sometimes conspiracy theories are correct. As Paulson said russia contacted china and they wanted coodirnated selling of GSE debt in order to force a bailout
"Since 1970, there have been nine quarters, like the last one, when GDP grew by at least 3 percent and inventories accounted for at least half of that growth. The history of those quarters is hardly a favorable sign of what is in store. Inventory spikes make for blowout quarters. In the nine quarters with such spikes, the average growth rate was 6.6 percent and the average inventory contribution was 4.4 percent, even higher than what was observed for last quarter. Spikes also produce hangovers. The average growth rate in the quarter after a spike was 0.9 percent, a whopping 5.7 percent lower. In the second quarter following a spike, the average growth rate is just 1.6 percent. " http://www.bloomberg.com/apps/news?pid=20601039&sid=a9CpuClIL12E
Please. Who knows if this was in the least bit true. Just because Paulson put it in there to sell some books doesn't mean squat. Even if Paulson actually thought it true at the time, where did he get this so-called intelligence.. From the same sources who do such a good job tracking terrorists getting on planes. Furthermore, this so-called intelligence makes no sense. Chinese weren't/aren't going to slit their own throats by firesaleing their bond holdings. Bully for you if reading this dribble gives you a bit of insight into making a profit in this business. To me these books (Greenie, Paulson, ...) are little more than a few hundred pages of justifications for the disastrous public service these individuals have performed. They throw in plenty of 'inside baseball' bullshit to sell books and make it seem like the reader is really getting the scoop (who knows, toss in some cool spying stuff like the Chinese/Russina GSE affair and maybe Hollywood will option the book and they'll get to meet Charlize Theron). If they actually did a good job and if they actually acted in the interest of the greater good, they wouldn't need to write several hundred pages explaining it. Paulson is very fortunate Eliot Spitzer isn't running Justice or he'd be under indictment for securities fraud.
Marc Faber in his latest newsletter sees further weakness in China and other developing and commodity nations dependend on Chinese growth with the S&P and the USD temporarily outperforming untill the S&P hits somewhere like 950 after which another (global) stimulus plan will be unveiled which should make trends reverse and sees precious metals stocks as one of the prime beneficiaries going forward. The latter should be accumulated on weakness.
Dude, Paulson has an estimated networth of $700M. I remember Ann Coulter saying she received like $2000 a month from her books. Do you really believe Paulson is going to drop this bomb in order to get more $1 per sale numbers We are talking about Russia, its far more likely there was something going on than a quasi billionarie tried to make some $ or that he wants to be in some movie. Now I do agree that is was possible that there was bad intelligence, or the intelligence was correct. My point is that the conspiracy is FAR more likely to be true when a top government official is the one who said it was true Also, Greenspan book helped me tremendously in holding these big dovish trades, that is because it helps you understand better how central bankers think.
...portion snipped... For the power elite, like Paulson, it's not about the $$. It's his legacy, his power play. He would do FAR more to secure his "legacy" than his fortune. So I would say yes to your question, but not because of money.
More on the Obama fiscal policy http://www.bloomberg.com/apps/news?pid=20601087&sid=aL975wIYeQjs&pos=1 That article does not mention what is the net tax change of his policy, its clear that there are plenty of tax cuts involved. I doubt that a Kenesyan administration will put a large net tax hike for 2011, perhaps over the next decade that would happen but Obama would risk reelection by raising taxes, risking a double dip with the UR so high