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Posts Tagged ‘CNBC

Media talks panic: Swine Flu

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Over my morning cup of coffee, I turned on the TV to see what was going on in the world. The big news of the day – and apparently the only story of the day – was the swine flu. Even CNBC asked, “Will Swine flu derail the global economy?” The Swine Flu story leads the Washington Post and the Financial Times.

So, what happened in the markets? A drop. Nothing like a good panic to cause a sell off!

Reporters even non-stop peppered Robert Gibbs at the morning’s White House Press Briefing, asking if Pres. Obama was sick, and complaining that they weren’t getting enough information on the President’s health. A simple “the docs say he’s healthy and fine” wasn’t good enough. The flu became the only topic discussed.

The U.S has a population of over 300 million people. 40 cases of flu have been reported. Yet, one would think from the media hype that thousands of cases have been reported in the U.S.

Pardon me, but I’m getting just a bit sick of the “one topic” media story. Especially the non-stop, endlessly detailed reporting of stories such as this one which appears designed to cause as much panic as possible.

Yes, there is cause for concern and caution. But really now, fostering a panic? The media definitely has lost its way. The job of the media is to report the news, not create the news…which is exactly what the media has been doing for the last couple of years.

What would Cronkite or Brinkley say about the over-hyping of one story, the endless reporting of every minute or associated detail, as if that one story was the absolute only thing occurring on the planet?

Enough already.

Written by Valerie Curl

April 28, 2009 at 12:55 AM

Economist Roubini says mortgage contracts should be broken.

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In speaking to CNBC today while attending the CBOE Risk Management conference, Roubini stated

…that the housing market, like a company restructuring in bankruptcy, needs to have “face value reduction of the debt.” Rather than go through mortgages one by one, he says reduction has to be “across the board…break every mortgage contract.”

The man who predicted this recession and has been right every time about its depth also says the stimulus package was not enough.

Roubini also took issue with the $800 billion stimulus package, saying it’s not enough. For one thing, there’s only $200 billion upfront, and half of that is a tax cut, which Roubini calls “a waste of money” that is not going to make a difference.

Finally, while he says there will be “a light at the end of the tunnel”, it’ll probably get worse before it gets better. Those who believe in a second half recovery this year “are delusional” he says.

In fact, based on Roubini’s calculations, we could conceivably see the S&P 500 at 500, the Dow at 5000.

So much for Republican ideology of tax cuts as the solution to every fiscal problem. So much also for getting out of this mess soon. I hope Roubini is wrong this time…but he’s been right too often for me to bet against him.

Nevertheless, I wonder about his idea of breaking all the mortgage contracts and restructuring them. Would it work? How would it work? And what would be the unintended consequences?

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