Research Zeitgeist: Regional Banks and GDP
US regional banks were top-of-mind at Research Recap this week. Last week’s popular post from Oxford Analytica, Regional US Banks May Need Rescuing, was the most-read post this week, while S&P “Very Cautious” on US Regional Bank Credit Quality made the top five as well. Standard & Poors also nabbed the second spot with Distressed Finance Sector Junk Bonds at Stratospheric Level while Audit Integrity’s Forensic Analysis Gives Clues to Lehman Problems came in at number three.
Monoline Stock Price Rally Overdone, from CreditSights, was also popular, and has since been followed up wiith MBIA Takes the Best, Leaves FGIC with the Rest. CreditSights sees the reinsurance transaction involving MBIA and FGIC as a positive credit development for MBIA, but says it does little to solve FGIC’s longer term solvency issues.
Outside the credit markets, Forrester Research’s provocative prediction “Serious Gaming” to Take Off in Coming Years was also well read.
Elsewhere, the surprising upward revision in second quarter US GDP growth to 3.3% was a hot topic. Felix Salmon at Portfolio.com laments what he sees as the decline of the quality of government economic statistics. FT Alphaville, goes further calling the number “laughable.” Yves Smith at Naked Capitalism smells “manipulation for political purposes.” There’s no clear evidence of this: there do not appear to have been any cahnges in which the caluclations are made. But you don’t need to agree to wonder about the discrepancy between the implicit priced deflator used to measure inflation in the GDP calculation (1.2%) and the much higher CPI and PPI numbers.
Research Recap Quote of The Week:
In other words, there would be only two persons of working age for every person aged 65 or more in 2060, compared with four persons to one today. – Eurostat – commenting on demographic projections for the 27 European Community nations.
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