Friday, March 07, 2008

Features of the week

Welcome to our Friday edition of, "Features". Enjoy this week's collection!

1. "Europe's tiny tax havens should be left in peace", writes Bloomberg's Matthew Lynn.

For more on this issue, please see the first item in our Feb. 22 "Features of the week".

2. Commodites have been a saving grace for investors.

3. How have the S&P 500 and US home prices fared in gold and euro terms? FT's John Authers examines this question in Friday's "Short View" column.

4. A disappointing February payroll report has convinced the holdouts (and campaigning politicians) that the US is in a recession.

5. "Margin call, gentlemen". Carlyle Capital Corp shares were suspended on Friday after lenders marked down the value of the firm's residential mortgage-backed securities.

An excerpt from this FT article details the problem:

"CCC is the latest casualty of the banks’ increasingly unforgiving attitude towards even the most powerful private equity funds when the highly leveraged mortgage-backed securities fund said it had failed to meet margin calls from some of its lenders.

The fund, listed in Amsterdam by the Carlyle Group last year, has been hit by a fall in the value of its $21.7bn portfolio of AAA-rated residential mortgage-backed securities, illustrating that even the safest investments can be perilous when combined with the use of massive amounts of borrowed money. Carlyle had $28 of borrowings for every $1 of its own money."

Rubber stamped AAA ratings probably didn't help much either.

6. Matthew Simmons sees a tight oil market and tells Bloomberg, "I don't think OPEC has any spare capacity".

7. "Who is blowing bubbles in the commodity markets?", asks Gary Dorsch.

See also, "Fed rate cuts backfire, lift gold and oil into orbit".

8. Hedge fund manager set to sue SEC over marketing rules.

9. The struggle between inflating and lending. Marc Faber's recent article for Whiskey and Gunpowder describes why gold will continue to be a key investment in the months and years ahead. Thanks to reader Diel for the tip.

10. Bear Mountain Bull highlights a recent Marc Faber Bloomberg interview.

11. Forbes ranks "The World's Billionaires". Four of the top 10 are from India. Wealth, at least at the high end of the spectrum, is now distributed globally.

12. Forbes - "A Word From Ron Paul". Very important message for America.

Thanks for reading Finance Trends Matter.

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Enjoy your weekend, and keep the comments and ideas coming.