Emini Trading Update – Wednesday 26 Jan 2011 (22:14)
I had a lot to talk about day – no apologies (it’s all good stuff and you should watch).
1. Forget State of the Union – the FCIC report came out and pointed fingers. Good. Now what? The other Barry (Barry Ritholtz) had a good summary over at The Big Picture.
2. Who would have thought the FCIC (Financial Crisis Inquiry Commission) would name names! The members didn’t look like trouble makers (with the exception of Brooksley Born). And the Chairman, Phil Angelides, was ex-Treasurer of California – a man who liked his debt on the “too big to pay back” side.
Postscript: Looks like I shouldn’t have given the FCIC a passing grade. Here’s what Yves Smith at Naked Capitalism has to say and Steve Keen at Debtwatch – the best economist in the world (and an Australian).
3. But don’t forget – everyone thinks The Crisis is over, it ain’t. We’ve blown a debt bubble and just shifted it from the banks, to the GSEs and finally onto the citizens. Ultimately the piper must be paid. And regulation won’t fix it. We do this on a regular basis – every 70 years or so. My favorite book on the history of debt bubbles is Devil Take the Hindmost by Edward Chancellor.
5. Oh and BTW. My Emini trades are being recorded at 4:30am Hawaii time – that’s why I’m almost whispering and you can hear the coffee percolating in the background.
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