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The Times' Rorshach Geithner Story
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Sinking Animal Spirits
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Counter-cyclical Urban Policy
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Be Your Own Counterfeiter
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Being Tim Geithner
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Notes From a Press Conference Naif
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What Good is the News?
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Stressful Enough
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Not Regretting the Pound
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Introducing the New Ford Squeeze
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Non-Economic Questions of the Day
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The Stress Test Blind Alley
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Happy Hour
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Recovery Without Rebalancing
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The Shape of Your Recession
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Subprime: The Cause Of All Market Moves
It's all subprime's fault. You knew that, right? The stock market goes down? Subprime. The CDS market gaps out? Subprime. The LBO market closes? Subprime. Treasury yields fall? Subprime. You stubbed your toe getting out of bed this morning? Subprime.
What can we learn from reading a story headlined "Wall Street Skids on Subprime Anxiety"? Honestly, I think the only thing to learn from such reports is that for the foreseeable future, every stock-market drop is going to be blamed on subprime mortgages. It's the new shorthand for "stocks went down and we don't know why".
But Justin Fox has found the real peach today. According to Bloomberg,
The Canadian dollar fell for a fourth day as investors sold commodity-linked currencies on speculation U.S. subprime mortgage losses will slow the world's largest economy.
Yep, the Canadian dollar fell against the US dollar on subprime worries. Or, to put it another way, the US dollar rose on subprime fears.
In other words, the subprime mess now explains not only assets going down, but assets going up, too! I honestly wouldn't be surprised at this point to see someone blame the outcome of the Japanese elections on the "subprime meltdown". It's lazy, and it's boring. Can we move on, please?
