Danger, Danger, Danger, Will Robinson

Well don't blame me when it happens. I am reading a lot of articles on how this is a bear market rally and it is over done. I have been saying this for weeks and I am bored with my repetition, so let me tell you how some other people are saying the same. You can start with the WSJ. It had a piece today on how corporate bond rates are generally a good predictor of the economy. And you guessed it, corporate bond rates are still in a maj0r funk.

http://online.wsj.com/article_email/SB123929216724105401-lMyQjAxMDI5MzA5OTIwOTkyWj.html

I separately subscribe the RGE Monitor. It is a free site and it is headed up by Nouriel Roubini, who to date has largely been dead on in this recession. I started actively tracking our current economic woes in January of 2008 and one of the key pieces I forwarded to my fellow investors at that point was Nouriel's testimony to Congress in about January 2008. At the time I told my colleagues that I hoped he was wrong but I suspected he was right. Guess what - so far he is right.

Another person I follow is saying the same thing. Barry Ritholtz, posts at RGE, but he also is a frequent speaker on financial related channels and he has his own blog that I follow at the Big Picture:

http://www.ritholtz.com/blog/

http://www.rgemonitor.com/us-monitor/256306/rally_too_flashy_for_our_liking

He is saying, accurately I believe, that we are oversold in a dead cat bounce and things will go back to normal and perhaps beyond,

http://www.rgemonitor.com/us-monitor/256298/earnings_season_is_crunch_time

Tell Us the Stess Test Results - Or Not?
Either way Transparency is Gone!

First you have the NY Times reporting that all is fine and well on the stress tests without - of course - any support for this proposition.

http://www.nakedcapitalism.com/2009/04/quelle-surprise-bank-stress-tests.html

Okay, they did say some banks will fail but overall a positive report. So what are the actual results of the stess tests? No one knows - or at least we do not know - because the Treasury is banning banks from revealing the results. So much for transperancy. Between that and the FSAB neutering the mark-to-market rule no one will have any freakin' idea how well banks are doing. To me, this is a signal to anyone thinking of buying these toxic assets or investing in banks to run as far away as fast as they can. By the way, another bank failed today. That makes 23 this year. Without the false government support for banks I have no doubt we would be over 100 and many would be some very big names.

http://www.calculatedriskblog.com/2009/04/bank-failure-23-new-frontier-bank.html



Disclosures: None.