Daily Reading – Wednesday, June 8, 2011

The Big Picture: Behind Ben’s psyche says ‘QE more’ always possible again

“Bernanke dashes hopes of new easing” says the front page of the FT as he said “monetary policy cannot be a panacea” with the difficult economic backdrop we currently face. The market obviously responded lower but Bernanke’s speech was instructive in another way, understanding his psyche to see where he may go from here.

Thin Progress: The Myth Of The Jobless Recovery

There is a lot of talk about whether this is a jobless recovery. The truth is, this has been a somewhat “growthless” recovery. Job growth is weak because GDP growth is weak.

FT Alphaville: China has ‘upped the ante’ in financial suppression, Dylan Grice says

Dylan Grice. Bless ‘im.

The Societe Generale strategist has managed to combine three of our favourite themes — China’s great central economy and big local government debt problems, financial repression and volatility.

FT Alphaville: Oxymoronic LME stocks

What we have now is a very unique situation in which prices are rising even as stocks are going up. And that’s just the on-market LME reported stocks that we know about.

FT Alphaville: Sino-Forest: the case for the prosecution

Much of the original 39 page research report and TRE’s second rebuttal concerns the amount of timber it owns in Yunnan province. This has been noted in various media reports but we took a second look at the report — it’s far from an easy read — and have tried to present the allegations in plain English below. We don’t (honestly) have an opinion on who is right but somone is surely going to end up with a reputation in tatters.

FT Alphaville: Sino-Forest: the case for the defence

In the previous post we tried to identify Muddy Waters’ (MW) main allegations concerning Sino-Forest Corporation’s (TRE) assets in Yunnan province, China.This post looks at TRE’s response and makes some new information publicly available.

FT Alphaville: Nomura says not a lot of cash growing on Sino Forest’s trees

Sino-Forest might have come down like one of its (absolutely plenteous) Yunnan broadleaf trees on Muddy Waters LLC…

And there’s a lot to leaf through (both pro and con) in the documents it’s released to investors… more on them in a bit.

But doubts about the company keep piling up, especially regarding Sino-Forest’s cash and debt position.

Some of the most impressive claims that FT Alphaville has seen in this area came from Nomura Asia credit analyst, Annisa Lee, on Tuesday.

Financial Post: Muddy Waters Sino-Forest research ‘pile of crap’: Dundee

“We are going to provide you with some information on why Muddy Waters research is a pile of crap,” said Richard Kelertas, an analyst at Dundee Capital Markets, during a conference call he held with clients on Tuesday afternoon. “We believe there’s nothing true in that report.”

DealB%k: A Trader, an F.B.I. Witness, and Then a Suicide

In a Manhattan courtroom last week, federal prosecutors played for a jury a secretly recorded telephone conversation between two Wall Street traders exchanging stock tips.

Two days later, one of those traders, Ephraim G. Karpel, hanged himself in his Fifth Avenue office, according to a law enforcement official.

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