Sunder’s List

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Photo credit: kevindean

Even the best investors make mistakes. Warren Buffett, who bought about $2 billion in bonds of power company Energy Future Holdings, said the investment is at risk of losing all its value after natural gas prices fell. (NYP) Here are 10 tips if you are losing money. (bclund)

The “Farmer and The Devil” story: how a good capitalist farmer had to sign a contract in which the Devil guaranteed a quadrupling of the farmer’s income through very aggressive farming practices at the hidden cost of 1% a year of his soil.  The farmer would enormously profit and eagerly re-up through the first several 20-year contracts only to end up with no soil, no food, and no people at about 100 years out – Grantham on how we don’t value our grandchildren. (FT)

We have our Kingfisher and Air India, the US has AIG, Bank of America, GE… How the US Treasury is allowing AIG to dodge taxes. (NYT)

On why governance matters: In the early 20th century Argentina and Australia were twin economies trading similar goods in the informal British Empire. Half a century later, the Australians were five times as rich. (Telegraph)

For the first time ever the world’s five largest central banks are simultaneously conducting aggressive easing operations. In addition to the US Fed’s ZIRP and willingness to buy bonds with no liquid market, the European Central Bank has launched its LTRO and has made virtually unlimited amounts of money available to European banks for three years at a mere 1%. The People’s Bank of China has just pledged ongoing Eurozone support and is expected to continue domestic stimulus. The Bank of England and Bank of Japan have both committed to additional aggressive quantitative easing. (SA)

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