“Should we fear a trade backlash?” – Trade & Immigration – Mark Thoma, Economist’s View
“Wine as an economic indicator” – Catherine Rampell, Economix 
“Is this where the $700 billion is going?” – Stephen J. Dubner, Freakonomics 

Pretty weak list.  Everyone’s on vacation

~house of cards ~ radiohead ~

I spend a lot of time watching the news, both at work and at home.  We all know what’s going on with our economy, how the fed and treasury are trying to help the financial system out, trying to help consumers out.  And then we see retailers increasing discounts during this time of looming depression to lure customers into relaxing their white knuckles on their cash.

But how has this economy really affected consumers?

Here’s how I see it so far – the banking system has crashed and is evolving into something never seen before.  The financial system is wiping out.  No longer do 150 year old companies exist.  More and more the sector is becoming an oligarchy.

And the news is reporting that it’s all about the credit markets.  Yes – well, it’s what caused it.  But it’s the banks’ problem.  I don’t really see it affecting consumers.  Their reaction to save more may be because of a perceived personal credit crunch.  But how many have you actually experienced a bank withdrawing your credit line on your card? 

I realize two separate points that go against this argument: 1) people are being denied new credit and loans, which cultivate growth in our economy and 2) people are losing jobs.

But for those not employed by the financial sector (about 94% I believe) – there’s still income.  Propensity to save is due to the fact that we see 6% of the job force is losing their jobs.  That we see foreclosures increasing.  That we hear banks not lending anymore.

Maybe I’m not making my point clear – consumers have money.  They have income.  They may not be able to move into a home – but they can still spend.  We still have credit, just not new credit.

Am I insane? I just saw someone on CNN saying they are choosing to use cash over their credit card.  But that means they have the ability to use credit.  I just think that the propensity to save and to spend shouldn’t be affected if you have a job.  You just can’t buy a house right now.

This point is not very refined – I just had to get it out there.

I can’t resist trading free money  

Current positions:
shorting the GBP against USD
long on both USD & GBP against JPY
^up $1500 for the day ^

Soon to-be-settled holdings (stupid program is slow!):
AAPL
CSCO
AEO
GS
TIVO
BEBE

Also looking into health care and pharma companies for this time in the economy.

Traffic is picking up – I should write more!  Anyone got ideas?

My current thought is (and it seems to be popular with the econ blogs out there…I had this idea two weeks ago!) – Keynesian versus Monetarism, their schools of thought argued against each other, especially pertaining to today.  This will take some research though, so it will take a while.

Any other banking/monetary policy ideas out there?

and I sold my USD positions.  Made $12K for the day.

wow! I’m already up $10 grand!

If you don’t know – please sign up for the million dollar portfolio challenge on CNBC.  It starts Nov 17th, with the publishing of qualifying trade-able equities on the 14th.  US equities on NYSE, Nasdaq, and AMEX can be traded (no IPOs after Nov 14th I believe), and currency can be traded.  No shorting, no options, no fun stuff.  You are able to practice currency trading before the game begins.  I’m already up $10,000! Trading GBP/USD, AUD/USD, EUR/JPY, GBP/JPY, GBP/CHF, and AUD/JPY, more to come…

check it outttt! Weekly prizes, bonus funds to invest, sweetness.

It was just announced, almost just in passing, that the rates accrued on excess balances at the federal reserve increased.  Instead of 75 bips below the target rate, it’s 35 bips.

Please – someone – realize that this is a big deal.

Maybe it’s just because I work at a bank.  Yay for us on increase interest, boo for the eventual increase in fed funds effective.

<<the outsider – a perfect circle>>

Interesting thought popped into my head today – indeed it’d be an unrealized self destruction.

One topic frequently, although on the back burner lately, is illegal immigration.  People coming through our borders, it’s a hot topic.  Especially with last year the development of the underbanked sector, where banks allow a way for the customer to obtain a tax ID number in order for them to open an account, get a mortgage, credit cards, etc. 

But what about foreign investment?  Direct or other…  I go into work each day thankful that I just bought into my 401k when everything is dirt cheap.  Yet it’s not just me that can see an opportunity.

With penny stocks in great supply now, it may seem like it’s a good idea to buy a lot for a great return later.  But it really only works in a developing idea.  Not so much when businesses have been publicly traded for years that have seen stock plummet.  Yet sovereigns and private wealth abroad, what will happen when they see an opportunity in established companies? 

If I remember correctly, it was reported that Saudi Arabia bought up stock in Citigroup.  Saudi Arabia’s FDI has increased steadily over the past 10 years, with last year being the largest foreign investor in the US.  Who’s to say that more investment won’t come?  In the form of buying up stock in undervalued companies?  Especially financial firms. 

Really, if bin Ladin wanted destruction of America, the financial markets would be the way to go.  Buy up firms to at least the point of majority vote, and reep the benefits!  Do what you want.  I begin to wonder why the stock crash in 2001 following 9/11 wasn’t fully taken advantage of by American-hating groups.

Illegal immigration may strain taxes, hospital care, etc.  But I can not possibly believe that it’s on the same level as a bailout plan for struggling banks, making it ideal for foreign investment to jump in now.

Am I correctly portraying this?  Is this an opportunity not realized by foreign investment?