Daily Reading – Tuesday, April 19, 2011

The Big Picture: Why Listen to S&P on US Debt?

There is an old Wall Street joke about analysts: “You don’t need them in a Bull Market, and you don’t want them in a Bear Market.

Which brings me to Standard & Poor’s. They put a “negative” outlook on the U.S. AAA credit rating, citing rising budget deficits and debt.

To which I say “Who Cares?

FT Alphaville: Losing my (AAA) religion

Alright, it’s waaayyy premature. But we thought we’d show the below — from RBC in response to Monday’s S&P action — showing change in 10-year bond yields after losing a triple-A…

FT Alphaville: At the outer edge of ratings territory

A few, final thoughts on the negative outlook for the USA from Jan Hatzius and his team at Goldman Sachs.

FT Alphaville: Hurdles to a Greek debt restructuring

Indeed, Deutsche reckons Greece would have to post a primary surplus of 10.2 per cent of GDP in 2011 just to stabilise its public debt. Since 1990, Greece’s primary budget balance has ranged from a deficit of 10 per cent of GDP in 2009 to a surplus of 5.8 per cent of GDP back in 1999. In fact, Greece is the only euro area member state for whom the 2011 surplus target lies outside the range of balances recorded in the last two decades, according to Deutsche. Good luck with that 10 per cent then.

The Slope Of Hope: Comment of the Day

JESSE’S CAFÉ AMÉRICAIN: How Far Can the Fed Go in Manipulating Markets Before It Becomes a Private Banking Fraud?

When does public policy go too far and become an instrument primarily serving private fraud?

I have had this video on the manipulation of the debt markets by the Fed in the Matières à Réflexion links since last week, but moved it here on request because apparently many missed it, and did not understand its importance, the implications.

Pragmatic Capitalism: Y2K = QE2

History shows us that each bubble needs a tragic muse.

The Nasdaq Bubble had both the allure and fear of a new millennium. Y2K was on one hand a software and infrastructure motivator, as well as a philosophical romance; drunk on the notion of a new era that would transform all that we understood and perceived about the world through technology.

With gold and silver today, it’s just as manic, evermore disturbingly romantic – and really just plain dark.

It’s a bubble with a raging mood disorder.

The Slate: The Double Irish and the Dutch Sandwich

The Explainer’s field guide to exotic tax dodges.

Huffpost Green: Water Wars: China’s New ‘Political Weapon’?

On the eight great Tibetan rivers alone, almost 20 dams have been built or are under construction while some 40 more are planned or proposed.

China is hardly alone in disrupting the region’s water flows. Others are doing it with potentially even worse consequences. But China’s vast thirst for power and water, its control over the sources of the rivers and its ever-growing political clout make it a singular target of criticism and suspicion.

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