As The Yankees Go, So Goes The United States.

June 7, 2011

One of the great things about being a New York Yankees fan is that their games are always on TV. I catch almost as many ballgames living in Atlanta as I did before I left New York five years ago. Watching a Yankee game the other night, I realized that I wasn’t just watching a baseball game; I was watching a microcosm of the United States. Just watch a ballgame …

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Creative Financing For Uncle Sam

August 23, 2010

Check the national debt clock: Our federal debt is $13.3 trillion, next year’s budget is $1 trillion in the red, and we have unfunded commitments for Social Security, health care and other programs as far as the eye can see. Is the United States already insolvent? Yes, according to a recent Bloomberg column by Boston University economics professor Laurence J. Kotlikoff. After comparing the government’s obligations with its expected future …

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Looking For A New Fall Guy

June 1, 2010

With unemployment as high as it is, you would think somebody would be interested in the Obama administration’s help wanted ad seeking a new national intelligence chief. But, having seen the way the president and his lackeys treated the recently departed Dennis C. Blair, nobody is rushing to take the job. What the president really seems to want is someone unsullied by past failures who can take the fall the …

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The TARP Shuffle

May 21, 2010

A few weeks ago, General Motors and the U.S. Treasury Department took the dance floor together for a turn at the “TARP money shuffle.” With much fanfare, the automaker’s chief executive officer Ed Whitacre announced that his company had fully repaid the bailout loans it received from the federal government. Five years ahead of schedule, no less. It was great news for GM, which has been struggling to compete with …

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Sensible Measures In Europe

May 10, 2010

European leaders, with some outside help, have finally moved decisively to deal with the debt crisis that was rapidly spreading from Greece to the rest of the world. The measures announced last night make sense and should restore calm to global financial markets — for now, at least. The extraordinary steps agreed to by the 16 nations that use the euro are reminiscent of the emergency measures that the U.S. …

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A Risk Premium For ‘Riskless’ Debt

March 26, 2010

For decades, finance professors have taught students that the interest rate on U.S. Treasury obligations reflects the cost of money for “riskless” obligations. Other borrowers’ riskiness could be measured by how much more than the Treasury rate they were required to pay. It is time to revise the lesson plan. Our national finances have deteriorated to the point that many corporate obligations are trading at lower yields than Treasury bonds. …

Seeking The Trophy CEO

December 21, 2009

Men of a certain age (mine) have an unfortunate tendency to toss aside faithful partners in favor of someone new and exciting. You’re not truly a big shot until you have that trophy wife hanging on your arm. I suppose you must be an even bigger shot if you can bag a trophy CEO. It is not my place to judge how people live their personal lives. I don’t want …

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A Built-In Bailout For FHA

November 19, 2009

One troubled underwriter hit hard by the subprime mortgage crisis won’t be asking for a government bailout, because it is part of the government. The Federal Housing Administration (FHA), created in 1934, insures mortgages, protecting lenders from defaults. Homeowners who receive FHA-backed mortgages pay insurance premiums in addition to their monthly mortgage payments, allowing the FHA to cover the cost to lenders when homeowners are unable to meet their obligations. …

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