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Apparently the markets think that U.S. risk of sovereign default is steadily creeping up. Hedge fund blogger Zero Hedge puts up the numbers here. According to the numbers from finance calculator company Markit, U.S. is a greater default risk than Japan or Germany, among others. A default would destroy the U.S. economy and TARP recipients, in particular. The Piqqem Sentiment on major TARP holders is more or less neutral, although the bankruptcy of the U.S. Treasury might change that, no?
The two big i-banks, Morgan Stanley (NYSE: MS) and Goldman Sachs Group, Inc. (NYSE: GS), appeared (ironically) among the best positioned, as they are already positioned to pay back TARP money and have marked down their portfolio to reasonable levels.
US Bank Corp. (NYSE: USB) is more or less bulletproof by virtue of its avoidance of the all funny sub-prime lending and bad credit awards that marked the last two years. Watch for further widening of CDS spreads as this could presage a truly awful event that would make even T-bills a less-than-safe haven. Can you say gold and oil, folks?
Alex Salkever is Director of Research at Piqqem.com, a Wisdom of Crowds stock research tool and investing community.
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Reader Comments (Page 1 of 1)
2-26-2009 @ 5:10PM
BHarrison said...
WOW . . . they didn't leave this story on "Page 1" for very long, did they?
If this doesn't make all of the responsible citizens who have lived responsibly and prudently want to hang all of the corrut politicians and CEOs and other corrupt people, then they are crazy.
The American people are sitting back just letting all of this "just happen" . . . with no massive demands for the indictment of the CORRUPT CEOs who orchestrated, or oversaw the orchestration of the BLATANT FRAUDS that undermined their corporations and our national economy.
And if there is no uproar over the likes of the INEPT, INCOMPETENT, and/or CORRUPT Congressmen such as Barney Frank, Ms Pelosi, Mel Martinez, Mr. Reid, mr. Dodd, then the American people have become naively stupid and/or apathetic fools.
These corrupt individuals who have become wealthy at the expense of the American people
2-26-2009 @ 5:22PM
gardens24u said...
I Agree With BHarrison
2-26-2009 @ 5:58PM
SKris said...
Actually, no, the US cannot default on its "sovereign" debt. How can the government default on a contract to pay back currency which it has the authority to print? It can't. It can however print so much money that it renders the currency meaningless. For those history buffs out there, the US has done just that 3 times in its history. Anyone betting on a 4th?
2-27-2009 @ 8:57PM
rjwslnj said...
Right, as long as people tolerate the blatant fraudsters and greed mongering corporate insiders, then nothing will improve. Our government has been thoroughly corrupted by big business lobbyists who have in turn stolen all the USA real wealth. The stock market is saying to them every day.."we have no faith or confidence in your system."
As a nation we hate this, but as individuals we feel powerless against these crimes. It's all sanctioned by lawyers, legislators, and power brokers, people so intent on money they do not mind destroying our whole country. We the people should charge them with treason, seize all their assets, and hang them publicly. Sign me up for it !!
2-27-2009 @ 11:43PM
sgentilejr said...
Anyone buying US Treasury notes or US Treasury bonds is a total and complete fool and they will lose every cent they trusted to the government. How can anyone be so foolish to lend the biggest debtor in the world (Uncle Sam) their money by buying Treasury notes or bonds? Might as well give it to Madoff.