by Dino

Note: Market Melange is trying something new, by providing live commentary on a story that is developing right now. Here goes. Clueless investors who cannot tell rumors from factual information deserve to lose money. That’s what will happen to those people who are buying shares of Washington Mutual (WM) right now. CNBC television, and in [...]

by Dino

Consider this July 18 cnbc.com article: “Lehman Brothers denied market rumors that it is going to take a writedown related to subprime exposure. The rumor dented stock prices and spurred buying in Treasurys, traders said. “The rumors regarding subprime exposure are totally unfounded,” a Lehman spokeswoman said. Rumors have been circulating since mid-morning that Lehman [...]

by Gregory

“Credit continued to decelerate in the first quarter of 2008. Total debt of the domestic nonfinancial sectors grew at a seasonally adjusted annual rate of 6.5%  (1 pp lower than in the previous quarter and the lowest rate since 2001)” . This was the picture given by the flow of funds data published last June. The [...]

by James

Given the turmoil of the previous week, investors appear to have taken pause over the last five days of trading. This might read positively, as housing data – arguably the key parameter in this downturn – continued to deteriorate. Experienced hands are unlikely assured though, being aware that equity valuations remain highly unstable, despite the [...]

by James

As recently as 1 July, MM described TNK-BP as a “canary in the mine” pointing to a possible rebound in Russia risk. Little did we realise how prescient our choice of language would be. Last week the canary took flight (TNK-BP CEO Bob Dudley left Russia, citing unprecedented harassment) and the miners immediately started falling [...]

by James

Investors across Russia could be excused for missing the controversial economic data that came out on Monday. Unlike its Western counterparts, the State Statistics Service prefers not to preannounce release times. This idiosyncrasy, which is hard to justify in a nation that aspires to become a global financial center, is not usually a problem, since [...]

by Gregory

How costly will be the credit crisis ? The IMF calculated that total losses may reach $945 billion, George Magnus of UBS estimated them at $1 trillion; Goldman Sachs put them at $1.1 trillion, the now-legendary hedge fund manager John Paulson announced them at $1.3 trillion. Recently, Bridgewater Associates estimated such losses at $1.6 trillion [...]

by James

Last week was mostly a positive one for equities, despite considerable mid-week volatility. The S&P 500 Index was down more than 3% at one stage on Tuesday, but climbed back impressively to close the week up 1.7%. S&P 500 Positive Results, But A Volatile Week S&P 500 Financials rallied 11.4%, and the MSCI World Index [...]