Weil on Finance: Sorry for QE
We meet again, View fans. Now on to the annotated morning reads.
Dear America: Sorry for quantitative easing
This piece is a jaw-dropper. Andrew Huszar, who managed the Federal Reserve’s mortgage-backed-security purchase program in 2009-2010, penned an op-ed for the Wall Street Journal in which he apologized for QE: “I can only say: I'm sorry, America. As a former Federal Reserve official, I was responsible for executing the centerpiece program of the Fed's first plunge into the bond-buying experiment known as quantitative easing. The central bank continues to spin QE as a tool for helping Main Street. But I've come to recognize the program for what it really is: the greatest backdoor Wall Street bailout of all time.” A must-read.
The stock market’s version of the Sports Illustrated curse
During the heyday of weekly sports magazines, the Sports Illustrated curse was legendary. Athletes would land on the cover and the next game would perform terribly or, worse, suffer an awful injury. Now we may have a successor of sorts: the Fantex curse. The IPO wannabe has two NFL clients: Arian Foster of the Houston Texans and Vernon Davis of the San Francisco 49ers. Foster is expected to have season-ending back surgery. Davis suffered a concussion on Sunday and left his game early. Fantex itself may be cursed. Peter Lattman of the New York Times explains that “Fantex had hoped to offer its first IPO at the start of the N.F.L. season, in part to avoid a midseason injury that could hamper a deal. But the review process by Wall Street regulators, especially at the Financial Industry Regulatory Authority, took longer than anticipated, which held up the company’s debut.”
Shiller usually knows a frothy housing market when he sees one
From Saleha Mohsin of Bloomberg News’s Oslo bureau: “Norway’s housing market, which Nobel Laureate Robert J. Shiller described in 2012 as being in a bubble, is now deflating faster than even the central bank had predicted after regulators introduced a slate of measures to cool demand. After home prices doubled over the past decade, fueled by low interest rates and surging oil wealth, they’ve slid for two consecutive months raising concern that real estate could be in for a hard landing amid record household debt.”
A new meaning for FIFO
The numbers geek in me always thought it meant “first in first out,” an accounting term that refers to the way companies report their inventory and cost of goods sold. It turns out that FIFO also stands for “fly in, fly out” workers, which I learned by reading this Irish Times article about Irish FIFO workers who leave their families behind in pursuit of high wages in Australian mines. There are thousands of them. I had no idea.
Bubble indicator of the day
See the headline on this Time magazine article: “After Twitter: 5 Potentially Blockbuster IPOs Coming Next”
(Jonathan Weil is a Bloomberg View columnist. Follow him on Twitter.)