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	<title>Comments on: Calling the bottom - in pictures</title>
	<link>http://ftalphaville.ft.com/blog/2008/03/25/11789/calling-the-bottom-in-pictures/</link>
	<description>FT Alphaville from FT.com</description>
	<copyright>Copyright The Financial Times Ltd 2006. "Alphaville", "FT" and "Financial Times" are trademarks of the Financial Times.</copyright>
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	<pubDate>Sat, 17 May 2008 11:53:32 +0000</pubDate>
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	<language>en</language>

	<item>
		<title>by: Bhavin P. Kapadia</title>
		<link>http://ftalphaville.ft.com/blog/2008/03/25/11789/calling-the-bottom-in-pictures/#comment-15908</link>
		<pubDate>Wed, 26 Mar 2008 01:52:27 +0000</pubDate>
		<guid>http://ftalphaville.ft.com/blog/2008/03/25/11789/calling-the-bottom-in-pictures/#comment-15908</guid>
					<description><![CDATA[I have to disagree with you MP, the graphs tell the story - no need for a caption.

The VIX surging, markets declining, spreads widening to unprecedented levels says more than words could.]]></description>
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		<title>by: Andrew Teasdale</title>
		<link>http://ftalphaville.ft.com/blog/2008/03/25/11789/calling-the-bottom-in-pictures/#comment-15894</link>
		<pubDate>Tue, 25 Mar 2008 14:38:04 +0000</pubDate>
		<guid>http://ftalphaville.ft.com/blog/2008/03/25/11789/calling-the-bottom-in-pictures/#comment-15894</guid>
					<description><![CDATA[This is merely the end of the beginning, not the beginning of the end.   We have yet to feel the full impact of a soon to be significant decline in US consumer expenditure, a decline which will further impact the build up of excessive financial leverage and place further strains on the myriad of OTC derivatives and off balance sheet securitised debt.  

Marginal liquidity that had moved to the sidelines or into commodities and other safe have assets has moved back into the market in the belief that the systematic risks to the financial system have abated and low interest rates will now be able to work through to the economy.   You only need a small marginal reallocation of cash and other assets to see the price recovery we have seen.

Andrew Teasdale

The TAMRIS Consultancy]]></description>
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		<title>by: MP</title>
		<link>http://ftalphaville.ft.com/blog/2008/03/25/11789/calling-the-bottom-in-pictures/#comment-15824</link>
		<pubDate>Tue, 25 Mar 2008 11:04:28 +0000</pubDate>
		<guid>http://ftalphaville.ft.com/blog/2008/03/25/11789/calling-the-bottom-in-pictures/#comment-15824</guid>
					<description><![CDATA[Many thanks. In exchange, here some thoughts from Peter L. Bernstein for the longer term:

http://www.fxstreet.com/futures/market-review/outside-the-box]]></description>
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		<title>by: Paul Murphy</title>
		<link>http://ftalphaville.ft.com/blog/2008/03/25/11789/calling-the-bottom-in-pictures/#comment-15822</link>
		<pubDate>Tue, 25 Mar 2008 10:31:19 +0000</pubDate>
		<guid>http://ftalphaville.ft.com/blog/2008/03/25/11789/calling-the-bottom-in-pictures/#comment-15822</guid>
					<description><![CDATA[Here you go MP.  From Mr Kemp this morning:

"The very short-term outlook (1-4 days) for asset prices appears fairly bullish. 

(1)  The federal government yesterday doubled the lending caps for the Federal Home Loan Banks (FHLBs) for the next two years -- essentially allowing them to purchase more than $100 billion worth of conventional mortgages packaged by Fannie Mae and Freddie Mac.  It is the first sign the federal government is prepared to buy mortgage-backed securities (MBS) in the open market in order to create a floor for the asset prices (rather than simply providing liquidity and making a market in them through sterilised repo operations).  

(2) JP Morgan quintupled its offer price for the collapsed Bear Stearns firm from $2 to $10 per share.  

(3)  Democratic Party presidential candidate Hillary Clinton proposed the federal government should offer $30 billion in direct assistance to homeowners at risk of foreclosure -- drawing a direct populist linkage with the $30 billion of assistance to Bear Stearns.  It marked the first time any of the three major candidates still in the race for the White House had actually proposed a direct bailout using taxpayers money (rather than liquidity providing loans to the banks).  

Combined with last week's unprecedented widening of the Discount Window to non-bank securities dealers (Bear Stearns, Goldman Sachs, Lehman Brothers, Merrill Lynch) and the range of other unconventional policy actions announced over the last ten days, it has raised market expectations that the federal government will now shoulder a large part of the costs of the mortgage meltdown -- guaranteeing a floor for MBS assets, helping avert a further rise in the default rate, and shouldering some of the credit losses.  

Dow Industrials closed up  187 points yesterday and are now >600 points up from their recent lows.  Most measures of risk aversion have fallen.  VIX equity volatilty has dropped from 32% at the start of last week to just 25.73% yesterday.  Credit spreads have narrowed slightly after flaring out sharply in the previous week.  The USD has steadied well above recent lows.  

The positive atmospherics should ensure a strong start to the week in both asset markets and commodities as investors try to pick the bottom and hunt for cheap assets to ride the rally.]]></description>
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		<title>by: MP</title>
		<link>http://ftalphaville.ft.com/blog/2008/03/25/11789/calling-the-bottom-in-pictures/#comment-15820</link>
		<pubDate>Tue, 25 Mar 2008 10:09:31 +0000</pubDate>
		<guid>http://ftalphaville.ft.com/blog/2008/03/25/11789/calling-the-bottom-in-pictures/#comment-15820</guid>
					<description><![CDATA[As John Kemp is a true "add value" observer, it would be very interesting to get some insight into the text that goes with the pics.]]></description>
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