Ctrl BG: A Shortcut to Financial News 10/10
Wow, so much has been going on, I don’t even know where to start! I guess to begin with, I’d like to thank everyone for sharing your thoughts. It has been truly fascinating to read about your opinions on this issue. It is always good to be able to hear about the other side of the coin, as my posts will reflect my own bias and I obviously do not know everything, I’m just interested.
I’m happy to announce that nothing too dramatic happened last weekend and no banks collapsed this week- at least not any American banks- yet. On the other hand, we experienced a 8 day consecutive drop in the stock market (globally), like the market has never seen since 1933. The US stock market dropped nearly 18% this week, with the DOW breaking the 9000 mark (and very nearly the 8000 on too today). Asian and European benchmarks posted their worst week as well, while some countries, like Russia, Indonesia and Ukraine were hit so bad that they suspended trading. Basically the stock market dropped and financial journalists are starting to run out of words to describe “down.” So how did this happen when the US congress just approved the bailout plan last Friday?
I’ve pinpointed it down to fear. Fear that this bailout plan will not work or came too late. Fear that the economy is heading for loooong recession (if we’re not in one already). Fear that more companies will declare bankruptcy and they will loose all their wealth. And fear is nothing if not a self fulfilling prophecy. As a result, people have been selling off their assets or redeeming their investments in funds, forcing funds to sell off their assets to meet these redemption demands, further driving the market down. Everyone wants to get their hands on solid cash right now- just in case. Emotion is a powerful force. Logically, having just read “The Warren Buffet Way,” I believe that as long as you’ve done your research and you believe that the firm is solid, then the market price of the firm will eventually match with the firm’s true value, despite market volatility. In which case, it sounds like there should be a lot of bargains out there right now- not that I’m giving out investment advice. Just musing. Various experts in the field have been debating whether we’ve hit rock bottom or not and there has not been a general consensus.
So does this mean the bailout plan failed to do its job of stabilizing the economy, since the market actually got worse after it passed? It’s far too early to tell (since it has not even been executed yet), but it’s comforting to know that something is being done to address the heart of the problem. If you caught a cold and it keeps getting worse, wouldn’t you go see a doctor and take some medicine, even though theoretically the body’s immune system will naturally fight off the infection, just in case it’s something worse than a cold that the body can’t fight off by itself?
Though of course, we must bare in mind that the bailout plan is not a cure all (or as Buffet puts it, a “panacea”). To that end, the government has come up with many other ‘cures’ for the economy:
- On Tuesday, the government announced that it will lend directly to non-financial companies through the commercial paper markets- which are short term, unsecured loans, firms use to borrow money for operational needs i.e. stocking up inventories. This will help companies finance their operational costs easier, since credit is so hard to get these days
- The Fed will start paying interest on commercial banks’ reserves, which will expand the central bank’s resources and more leverage to battle the this credit market
- On Wednesday, central banks around the world, including US, Britain and China cut their interest rates, which, made together, is supposedly a more powerful move. This is aimed to lower the cost of borrowing and put more liquidity back into the market (and of course there are a host of other effects, but this is the gist). This is one of the most powerful weapon in the US government’s arsenal, but at 1.5% (after a 0.5% cut), they don’t have much further to go. Any further, and they’ll end up like Japan with no more room to adjust their interest rates and a decade long recession. You know the song that goes, “catch a falling star and save it for a rainy day”? I hope there aren’t too many even more rainier days ahead, because it looks like we’re running out of stars
- Paulson and Bernanke met up with representatives from the rest of the G7 on Friday, to discuss the global economy and came out with a list of broad common goals. I thought those goals were a given, but I guess not.
- They also announced on Friday that the US government will be injecting money into financial firms in exchange for equity stakes, in an attempt to recapitalize firms. At least we’re getting something back. Maybe this will help Morgan Stanley, which has been under pressure this week with rumors that MUFG might be pulling out/demaind their stakes and what not.
Speaking of banks, Wells Fargo got the clear from the Fed to go ahead with its deal to buy Wachovia after Citi dropped out from the talks on Thursday to split up the deal. As one would expect, the bidder with the biggest wallet won. Still miffed at being upended out of a bargain, Citi will be seeking damage retributions from WF and Wachovia. Good luck with that.
Over at the other side of the world on a small island of 300,000 people called Iceland, the government nationalized (or rescued) their three biggest banks and closed the stock market, while their currency plummeted (the last I checked it was by a 1/3). Having out grown its Iceland’s economy, the banks were struggling to stay afloat in this market with their heavy debts. Some citizens have even lost their life savings becase of this. The government is now currently waiting on a $5.4 billion loan from Russia, the only country who responded to their pleas, having been reluctant to accept anything from the IMF. Not that Russia is doing too well themselves…… I wonder if it’s possible for a country to go bankrupt. What happens then? On the otherhand, if anyone is interested in visiting Iceland any time soon (I heard the nature stuff is very pretty over there), Icelandair is offering a “Winter Madness” package for 3 nights staying at the Hilton, for only $549!
( This post is from an independent writer. The opinions and views expressed herein are those of the author and are not endorsed by trendpk.Com.)
Ctrl BG: A Shortcut to Financial News 10/10 was first posted on October 11, 2008 at 9:10 am.
BCBG 30% off Coat Sale!
I guess one of the silver linings to this credit crunch is that sales and special/private sales are creeping in on us way earlier this year. One of the best bargains in my opinion? The BCBG 30% off select outerwear sales. Quite a bargain at this time of the season, when it’s barely cold yet. If you buy it now, you’ll still have plenty of time to get your mileage out of them in the next few months!
I personally have my eye on this fabulous white coat. I’ve been wanting one since Devil’s Wear Prada came out, but haven’t bought one for fear that it will turn beige/grey all too soon. Made of wool, rayon and cashmere, it will at least be warm enough until Christmas. The double breasted design with the tie on the waist, makes it an instant classic. And isn’t the trench coat like design at the back just beautiful?
Alas, even at 30% off, I still find it a bit pricey for my budget. But if you aren’t as limited, I think this is quite a bargain (along with a few other of their collection). So don’t miss it, because this offer only lasts til October 13th (tomorrow!).
Image Source: BCBG
( This post is from an independent writer. The opinions and views expressed herein are those of the author and are not endorsed by trendpk.Com.)
BCBG 30% off Coat Sale! was first posted on October 13, 2008 at 2:10 am.
Something Pretty
I used to not care about my underwear. No one saw it, so what’s the big deal? I just didn’t get it.
I get it now. All thanks to a trip to Italy, where women take looking good seriously, no matter what clothing article you’re talking about. During my time there, I found myself getting hustled into Intimissimi by my mum. It was like Italy’s version of Victoria’s Secret, except it was beautiful, relaxed, and not eye blindingly pink. It was there where I found myself surrounded by dainty things of lace, satin, and ribbon.
I am now totally obsessed with lingerie in general. Slips, camisoles, etc, you name it, I wish I had it all. And while my wallet doesn’t stretch to the lengths of La Perla, no one ever said I couldn’t look.
And who cares if no one sees it, it makes me feel glamorous. And to have a drawer filled with pretty little things to pick from each day? I don’t have a problem with that.
Image Source: Intimissimi, La Perla
( This post is from an independent writer. The opinions and views expressed herein are those of the author and are not endorsed by trendpk.Com.)
Something Pretty was first posted on October 14, 2008 at 11:10 am.
HG Takes a Break
Moving forward, BG has decided to continue blogging while I have decided to take a break. Obviously I love
I am Fashion (since I have blogged for almost 4 years,) but there comes a point where I feel that I should focus on other aspects of my life. Hence, I will be taking a break from the blog. It has been fun to share my thoughts on girly stuff with you all and hear what you’ve got to say about it as well. Hopefully I will be back soon!In the mean time, BG will be blogging as usual and will be temporarily joint by E, who we’ve known since high school and is now based in San Francisco.
Enjoy!
Lots of Love,
HG
( This post is from an independent writer. The opinions and views expressed herein are those of the author and are not endorsed by trendpk.Com.)
HG Takes a Break was first posted on October 15, 2008 at 5:10 pm.
Paris S/S 09: Chloe
I am like 2 weeks too late, but it would be a great shame for me to skip over the Chloe collection, a brand which I’ll always have a soft spot for. It would also be a shame to miss this collection, because this is Hannah MacGibbon’s first collection at the helm of Chloe. Mr.Toledo finally gave the boot to Paulo Melim Andersson, who’s aesthetics was clearly at odds with the classic Chloe girl. I shudder thinking about the last collection. Fortunately for us, MacGibbons seems to have a much better grasp of what Chloe is supposed to be about- and she should, having spent five years working at Chloe under Phoebe!
A few things that stood out, that MacGibbon brought to the table. First, there is this very interestingly structured top design (left). I’m not sure how practical it is, but it is definitely cute, girly and innovative.
Then there were the scallop-edges everywhere (right). Not too sure how I feel about them though. They’re feminine and very clever in that memorable way- next season when I see scallop-edged clothing, I’d definitely think of Chloe. On the other hand though, the scallop-edges around the shoulders and sleeves, kind of makes the model look as if they’ve been pinned up to an invisible wall.
I much prefer the scallop-edges (or “dinosaur scales”) at the Christopher Kane runway. These are refreshing, innovative but still very flattering and pretty at the same time. 
Back on the Chloe runway, I am finally seeing the Chloe girl. That relaxed and effortlessly chic girl on the streets.
Personally, I am loving the richly colored, silky evening wear. It is evening but not overly formal- perfect for a fun night out. Very girl and definitely very youthful…maybe even a bit too youthful, what with the fluttering sleeves and poofy skirts (right). Nevertheless, I definitely see many starlets wearing it in the season to come.
Lastly, let’s not forget the shoes. I love how it is so simple and wearable-looking- which means I can potentially wear something similar next season! The shoes on other runways are so sky high that I trip even imagining myself in them!
Image Source: Style.com
( This post is from an independent writer. The opinions and views expressed herein are those of the author and are not endorsed by trendpk.Com.)
Paris S/S 09: Chloe was first posted on October 15, 2008 at 5:10 pm.
