We reported last week on the fear and trembling of bond vigilantism, real or imagined -- that the bond market would punish the country for profligacy by raising the interest it demanded to lend us money, thus making everything…
We reported last week on the fear and trembling of bond vigilantism, real or imagined -- that the bond market would punish the country for profligacy by raising the interest it demanded to lend us money, thus making everything…
Call me a contrarian -- or just your garden-variety journalist/skeptic -- but when I read the much-ballyhooed Standard & Poor's announcement yesterday, I shook my shiny head. "Because the U.S. has, relative to its AAA peers, what we consider…
Federal Reserve Chairman Ben Bernanke spoke at the European Central Bank in Frankfurt, defending the Fed's $600 billion stimulus and calling on China and other fast-growing economies not to gain an unfair market advantage by devaluing their currencies. Jeffrey Brown…
Question: My question is: What about U.S. bond holders? I’ve seen bailouts of incompetent banks and businesses and some selective shareholder groups. Investment grade bonds were considered to be the safest investment next to…
Question: If you go back and look at the recession of 1982, you will see that the Fed bailed out large banks mainly due to bad LDC loans. I think the precedent of moral…
Financial advice is often loaded with misconceptions and misinformation. In the latest edition of Finance Fallacy, Paul Solman and Boston University professor Zvi Bodie debunk the belief that investing in stocks is the safest, smartest route to financial security over…
Question: I live in California and own California State Bonds. What happens to state bonds if the state goes bankrupt? Paul Solman: They stop paying, both interest and principal. That’s what a default IS. Last September 15, Lehman Brothers…
Question: There’s been speculation that China will lessen its ties to the U.S. dollar and U.S. debt. Some countries would also like oil to be priced in something other than dollars. If these events were to happen, what might be…
Question: If General Motors is “restructured” (either through the bankruptcy courts or outside the bankruptcy courts), will the shareholders lose all of the stocks they currently own? Or, as long as GM is a viable company traded on the…
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