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House Prices: Real Prices, Price-to-Rent, and Price-to-Income – Calculated Risk

Catalog Themes In Keeping With the Times – Minyanville

Risk, Cost, and Obligations – The Atlantic

Obama’s Nice Guy Act Gets Him Nowhere on the World Stage – Spiegel Online

Upon taking office, Obama said that he wanted to listen to the world, promising respect instead of arrogance. But Obama’s currency isn’t as strong as he had believed. Everyone wants respect, but hardly anyone is willing to pay for it. Interests, not emotions, dominate the world of realpolitik. The Asia trip revealed the limits of Washington’s new foreign policy: Although Obama did not lose face in China and Japan, he did appear to have lost some of his initial stature.

Explaining the Birth/Death Model and Unemployment Rate – Mish

Most global banks are still unsafe, warns S&P – The Telegraph, Ambrose Evans-Pritchard

While some banks may look healthy under normal Tier 1 and leverage targets, critics claim these measures can be highly misleading since they fail to discriminate between high-risk and low-risk uses of leverage. The system failed to pick up the danger signals before the financial crisis. The supposedly moderate leverage of US banks in 2007 proved to be a spectacularly useless indicator.

S&P has shifted to a tougher code. It is less tolerant of hybrid capital – a liability rather than an asset, and no defence in a crunch – and insists that banks must quadruple capital put aside to cover trading desks. Private equity exposure will be treated more harshly.

GDP Revised Down

Real gross domestic product — the output of goods and services produced by labor and property located in the United States — increased at an annual rate of 2.8 percent in the third quarter of 2009, (that is, from the second quarter to the third quarter), according to the “second” estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP decreased 0.7 percent.

GM’s sale of Saab falls through – The Los Angeles Times

General Motors Co.’s plan to sell its Saab unit to a specialty Swedish automaker has collapsed, frustrating another attempt by GM to prune its roster of automotive brands and potentially spelling the end of the Saab brand.

Koenigsegg Group said today it had canceled the proposed acquisition of Saab because of risks created by delays in completing the deal.

GM officials said they were “very disappointed” by Koenigsegg’s decision. The Swedish carmaker, which makes so-called super cars that can top 200 miles per hour, had joined with Chinese automaker Beijing Automotive Industry Holding Co. on the deal.

“We’re obviously very disappointed with the decision to pull out of the Saab purchase,” said GM President and CEO Fritz Henderson. “Given the sudden change in direction, we will take the next several days to assess the situation and will advise on the next steps next week.”

A GM spokesman declined to comment on Saab’s future. But Saab, which employs about 3,500 people and has a single factory in Trollhattan, Sweden, has been a drain on GM’s finances. Saab’s sales are down 61% in the U.S. this year. The unit sold only 513 vehicles in the United States last month and two weeks ago said it would slash its U.S. dealer network by 37%.

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