Fructose

You could make a pretty good case that the current meltdown of the world economy could have been prevented if American regulators hadn’t been asleep at the wheel.  The Fed, the SEC, and the Office of Thrift Supervision come to mind as parties that could have, in different ways, put the brakes on the housing [...]

In my inbox

From a recent email I received….
“Greetings,
I Donald and my sister Jenny may wish to know if we can entrust in you in helping us to receive the $35mUSD (Thirty Five Million United States Dollars) our parents had with a Financial Institution here before their untimely death by the assassins.”
And so forth.  This is of course [...]

Kicking off the Death Spiral

Beware the individual health insurance market (yes, that’s the market McCain wants to push millions of people into). Consider this situation: let’s say you do the right thing and buy an individual health insurance policy when you’re healthy, pay premiums for years, then get sick.
The insurance company pays the initial claims, but they [...]

Is that stent right for you?

Maggie Mahar reports that coronary stent manufacturer CypherUSA has launched a massive, glossy, direct-to-consumer advertising campaign encouraging consumers to take charge of their heart surgery by demanding the CypherUSA stent. She describes their latest commercial here, or you can watch it here, However I’m imagining the scene in the doctor’s office as these crucial, pre-op [...]

Slimymarketing Alert

Have you purchased health insurance through a college or university recently? Be advised that those seemingly trustworthy institutions are selling some slimy merchandise: health insurance. BusinessWeek reports that many people with claims under those policies are finding themselves not-so-insured:
More than half of the insurance plans recommended by colleges offer benefits of $30,000 [...]

Faith in markets

Now that housing and credit market fiasco is clear to all observers it might be a good idea to ask how we got here. Answer: regulators asleep at the wheel. Or, more precisely, blind regulators. Blinded by ideology. It worth re-reading something Paul Krugman had to say on this subject [...]

Through a Glass Darkly

Economists tell us that capitalism works best when buyers and sellers are fully informed. Or, to use the buzz word, when markets are “transparent”. How transparent are US markets? Back in 2006 Treasury Secretary Paulson lauded the US capital markets as “the most transparent in the world”.
For an update and a real world [...]

Uh-oh

Snake oil salesmen beware… from AP:
“WASHINGTON – The FBI on Tuesday said it is investigating 14 companies for possible accounting fraud, insider trading or other violations in connection with home loans made to risky borrowers.
Agency officials did not identify the companies under investigation but said the wide-ranging probe, which began in spring 2007, involves companies [...]

21st Century Snake Oil

Ever wonder how so many people ended up in subprime mortgages? It wasn’t just that people with bad credit got loans they probably shouldn’t have. As the Wall Street Journal reported last month

“…as the number of subprime loans mushroomed, an increasing proportion of them went to people with credit scores high [...]

Skimming

Michael Lewis at Portfolio.com:
As a group, professional money managers control more than 90 percent of the U.S. stock market. By definition, the money they invest yields returns equal to those of the market as a whole, minus whatever fees investors pay them for their services. This simple math, you might think, would lead investors to [...]