Motley Moose – Archive

Since 2008 – Progress Through Politics

Earnings – who knew?

Cross-posted at River Twice Research.

With a slew of major companies reporting earnings so far, it’s clear that expectations were severely skewed to the negative. Once again, Wall Street analysts overshot – this time to the downside. The substantial margin expansion reported by Intel; the higher-than-anticipated profitability of IBM; and the blow-out quarters of Goldman Sachs and JP Morgan all stand in contrast to sentiment just a few weeks ago, which was grim and getting grimmer. So what happened?

First, the robust results of some of the banks so far is the result of trading revenue and changes in accounting rules rather than a sudden improvement in losses from bad loans. Still, income is income, and the more they generate, the easier it will be to absorb those losses from consumer, commercial and business loans that will continue to go sour for some time.

You can be great at soccer, or globally dominant – you can't be both

So the United States lost to Brazil in the final of the FIFA Confederations cup, in that thrilling but painful tale of two halves, with the U.S. up 2-0 only to see Brazil roar back (or rather dance and prance and glide with balletic ferocity) and win 3-2. All I can say is, thank god.

For the past sixty years, the powerhouses of international soccer (a.k.a. football) either have been empires past their prime and on the decline or countries that dream fruitlessly of empire – England, France, Italy, Germany, Argentina, Brazil, and Spain. To bestride the world as a soccer power is to not bestride it as an economic or military power. In its period of global hegemony, the United States was manifestly not a global powerhouse in soccer. It was mighty in everything but the sport that is played by more people in every corner of the world than any other. And so if the United States had magically defied the odds and the gods and beaten Brazil, it would have been the final sign that American is indeed in decline.

Youssou N'Dour, "I Bring What I Love": An elegaic meditation on faith, Islam and music

Cross-posted at River Twice Research.

President Obama’s speech in Cairo last week as well as the candid and heated debates in Iran during its contentious presidential election provide yet another opportunity to revisit the sterile images of Islam that dominate the discussion both in the West and throughout the Muslim world as well. That discussion is framed by Muslim terrorists or extremists on the one hand squaring off against secular but resentful populations on the other. That is one facet of a kaleidoscope, a potent one but in no way the only one.

If there’s any doubt on that score, a new documentary focusing on the career of Senegalese singer Youssou N’Dour should dispel it utterly. “I Bring What I Love” is an elegiac, beautiful film, years in the making, and it will start playing in New York this week and then in Los Angeles and elsewhere. Like all documentaries, it will be dwarfed by the summer blockbusters that surround it, but this film deserves an audience.

The unknowable lightness of being

Cross-posted at River Twice Research.

Each month, the Federal Reserve releases its latest minutes of its last meeting along with its projections of economic activity ( The minutes just released indicate that its prior forecasts have been tweaked a bit, with update projections for unemployment over the next two years, GDP growth, and inflation. As new data become available, the hundreds of economists at the Fed revise and recalculate numbers, which means that any forecast rarely lasts more than a few months.

And yet, the Fed’s forecasts – along with the World Bank, the International Monetary Fund, the Office of Management and Budget, the Congressional Budget Office and various others – are used to frame every single meaningful discussion about the economy. They become the fodder for media reports, for budgetary decisions made by companies, and for individuals who digest the sound-bites – “Fed predicts unemployment will level off at 9% next year” – that shapes their sentiment. Investors also turn to these signposts as markers to navigate a complex world.

Enough already

The financial markets are again getting pummeled, both domestically and globally; the nearly $800 billion stimulus package signed with fanfare by President Obama has done little to alter the mood. In fact, if you read through financial websites and assorted blogs on politics, economics, or anything related to those, you will find a nearly endless sea of misery. The level of anger, pessimism, despair, and sheer hopelessness seems to reach new peaks every week, in inverse relation to the movement of global equity prices and the size of individual retirement accounts.


Cross-posted at River Twice Research.

After months of confusion, we are about to close a painful chapter in the economic crisis of 2008-2009. With the imminent passage of the $800 billion stimulus package combined with the roll-out of the next stages of the government-orchestrated bank bailout and recapitalization, we are about to end the talking phase and enter the doing phase. While no one can say for sure whether these plans will work, it’s certain that they will have an effect.

Don't Demonize Debt

As Wall Street continues its slow-motion hari kari, tens of millions of people on the lower-end of the income spectrum are finding that their access to credit is becoming all but nonexistent. As banks set aside ever more cash to cover themselves against potential future losses, the credit spigot that flowed so promiscuously to riskier customers is now not flowing at all.