Taking Back Habeas Corpus

“I’m a little Ron Paulish,” declared bond king Bill Gross to CNBC.

Recall from yesterday’s 5 that in his monthly letter, Gross groused that near-zero interest rates would hamstring developed economies and even “give a rise to commodities and gold as store of value alternatives when there is little value left in paper.”

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Gold in the Face of Facebook

Stocks are up today. The major indexes have jumped 1%… for no obvious reason.

There’s talk of a halo effect from the pending IPO of Facebook, which could file the paperwork as early as today.

Oy… Talk about “riding on a smile and a shoeshine,” to borrow from Death of a Salesman.

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Trends that Won’t End

U.S. taxpayers have lost $133 billion from TARP — the abominable acronym inflicted on us by former Treasury Secretary Hank Paulson — a new report out this morning shows.

We begin another week pulled in two directions: In one direction lie unresolved failures in policy… and the mayhem it has wrought in the financial system. In the other lie breakthroughs in energy and biotechnology.

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Embattled Washington: From SOPA to the Debt Ceiling

It’s hard to crawl the Internet today without running across something like this…

Wikipedia Blackout Notice

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S&P’s Message Falls on Deaf Ears

By all accounts, the stock market should be in free fall after a holiday weekend in which “the cosmic Brink’s truck of free money went over a cliff,” as Vancouver veteran James Howard Kunstler put it.

Alas, so much for the latest euro-driven meltdown.

After the close in Europe on Friday, Standard & Poor’s downgraded nine European countries, including heretofore AAA-rated France. Then on Monday, as a coup de grace, it downgraded the eurozone rescue fund.

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The Basic Problem With the Fed

We had to wait five years. But it turns out our suspicion that the Federal Reserve is clueless, at best, is true. We know because we read it in The New York Times.

Welcome to another Friday the 13th… Where if things aren’t exactly scary, they’re definitely surreal.

The Fed performed its ritual year-opening document purge overnight… unveiling the transcripts from Federal Open Market Committee (FOMC) meetings in 2006.

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Another Good Year for Gold and Gold Stocks?

A new year, yes. But a well-aged story: Generalized fear and loathing about Europe is fueling the safety trade.

The longest, most-boring financial crisis in history continues.

For laughs, let’s tote up the damage:

  • The Dow is down nearly 1%. Other US indexes are down more, others less
  • Banks dragged down European stock indexes. Spain closed down nearly 3%, Italy 3.5%
  • The euro is down to $1.279 — a level last seen in September 2010
  • The dollar index is approaching 81 for the first time in a year
  • The yield on a 10-year Treasury note is back below 2%
  • Oil is down about 1%, to $102.21
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The Crushing Weight of New Laws and Federal Tax Codes

The sale, trade and distribution of shark fins are now banned in California.

Daily drink specials — i.e., happy hour — have been banned in Utah.

Volunteer Little League and Pop Warner Football coaches in Colorado must now undergo annual training. Georgia set new safety requirements for golf carts driven on streets.

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Dividends Are Sexier Than You Think

Last month, the dividend yields on American AAA corporations moved above the yield on 30-year Treasury bonds! That had never happened before.

Even after last week’s stock market rally (which pushed dividend yields lower), the stocks of America’s four AAA companies still yield about 3%, on average, which is not quite as high as the yield on 30-year Treasury bonds, but still much higher than the yield on every Treasury bond of 24 years or less.

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