Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

The $3 Trillion Impact

By -

From HedgeFundTips.com: In 2007 the Financial Accounting Standards Board (FASB) made an accounting change – referred to as FAS 157. FAS 157—also known as “mark-to-market,” or “fair value accounting” was primarily responsible for putting Lehman Brothers into bankruptcy and triggering the dominoes that would subsequently fall in concert. The assets didn’t change materially, the “required” accounting of them did. This well-meaning, but utterly ham-handed effort was largely responsible for precipitating the Great Financial Crisis of 2008-2009. You can see the correlation on the chart above between the time FASB implemented the new rule (starting the crash), and when they reversed their mistake (market bottom in 2009). There is no coincidence in this timing.

(more…)

Financial Fliers

By -

Another day, another screen full of green.

One by one, the “overhangs” to the market are disappearing. The last one, and by far the largest, is the China/US deal. All signals seem optimistic on that front, and no doubt there will be SOME kind of agreement put together in the weeks ahead.

One thing of aid to the bulls recently is that the financial sector burst out of a range it has been in for much of the year. This clears the way for a continued assault toward the highs last seen on December 3rd.

xlf