- Goldman Sachs gets sued by the SEC. So they sold a CDO based on a set of mortgages that were specifically chosen by John Paulson, who shorted the portfolio. The case is that Goldman Sachs did not reveal they knew Paulson was net short (choosing to only reveal that Paulson was an investor in a small part of the portfolio, not that he was seriously short it).
- WSJ: It’s revealed that the SEC was aware of fraudser Allen Stanford’s scheming as long ago as 1997 but did nothing about it for 10 years. Was the Goldman news a good cover up?
- China introduces stricter regulation for home loans – increasing down payment requirements, and interest rates for home loans,
- US Stock markets fell 1.1% – a kind of fall that is fairly average in India but wasn’t at all seen in the US recently. Since the GS news happened after Indian market hours, we’re expected to slide down on Monday.
- The last government bond auction went through without devolvement. But the 10-year’s yield is at 8.07% and the 12-year bond (which was sold on Thursday) jumped to 8.33% in the auction, which is fairly steep for a 2-year jump (the 22 year bond, a further 10 year jump is trading at only 8.56%). The yield curve is fairly steep. One of these days I’ll get myself down to charting it.
- More to come this week: Another Video tomorrow, with some interesting data points. Separate videos on market charts. A new forum for this site (thanks for the suggestions!) and some interesting software tools for options. Watch this space.
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