We wrapped ourselves in an intellectual security blanket sewn together by our brightest economists and many of their mathematically gifted progeny, the Ph.D. "quants" of Wall Street. We were taken in, as we so often are, by an inflated belief in our own powers. And hubris--as always--was rebuked with catastrophe.
Is It Capitalism's Fault? http://www.realclearpolitics.com/printpage/?url=http://www.realclearpolitics.com/articles/2009/02/the_end_of_american_capitalism.html
Given the amount of time that the SEC and the media have been sniffing around his operation, today's fraud charges can't have come as much surprise to Allen Stanford. And given that he owns banks in many different jurisdictions (the FT has found entities not only in the US and Antigua, but also New Zealand, Switzerland, Colombia, Ecuador, Mexico, Peru, Venezuela, and, of course, Panama), as well as what Matthew Goldstein calls "a number of private jets", one expects that at this point his contingency plan is well underway. http://seekingalpha.com/article/121037-stanford-the-manhunt-begins
The China bulls have commented approvingly on the growth in loans in China, seeing it as a sign of pending recovery, along with an upswing in stock prices. We've pointed out that economist and China commentator Michael Pettis has heard quite a few reports that many of these loans were in fact sham transactions to meet government targets.
And now it gets even better. One analyst estimates that more than 1/3 of the total "new" lending (assuming that the loans were truly extended) may have gone into the stock market.
http://www.nakedcapitalism.com/2009/02/so-much-for-stimulus-chinese-loans.html
http://danskeresearch.danskebank.com/link/Meltdown17022009/$file/Meltdown17022009.pdf In conclusion, the crisis in Central & Eastern Europe (CEE) is getting out of hand and investors are aggressively exiting CEE markets. The most likely outcome is a very sharp fall in economic activity across the region. Pressure on CEE markets will probably continue until either the EU and/or the IMF intervene decisively.
