Has the US passed the private leverage baton to China, and will the results be the same?

Private debt was declining in China until 2008, but then everything changed in a big way.  One has difficulty in imagining a very soft landing.

Please Dr. Yellen, are we taking enough risk yet?

An article in the FT by Patrick Jenkins yesterday identified 5 dangerous bubbles: 

1.      Leveraged loans.  Securities representing $260 bn in covenant light loans were issued in 2013, up 69% from previous peak in 2007. 

2.      ETFs.  Liquid securities composed of increasingly illiquid assets that must be liquidated as EFT's are redeemed have proliferated.

3.      Eurozone sovereign debt.  Peripheral countries like Portugal are paying the same rate as the US treasury.  (Does this reflect overconfidence in Portugal or lack of confidence in the US?) 

4.       European bank paper.    A DB-issued cramdown hybrid bond was 10x oversubscribed, and Spanish non-performing loans quoted at prices that would yield 14% were they paying, which they are not. 

5.      UK property in the southeast.  London house prices have gone from 4x the average earnings of first time buyers to 8x.

The mouse that snored: Shouldn’t the newest EU members be the most enthusiastic?

Slovakia led the 28 EU member countries in apathy in Sunday’s parliament election with the lowest turnout, 13%, compared an EU average of 43%.

With thieves and morons so-well represented, why leave out those of us who are overweight?

A Michigan State University study documents weight bias in U.S. elections.  Overweight candidates get fewer votes than do the svelte, and overweight women fare worse than men with the same profile.  This means the third of the population who are obese are underrepresented in office. (From an article in a paper picked up on a Toronto street on Monday)

Is it still possible for a Nigerian politician to be too trusting and naïve?

Interviewed on Al-Jazeera TV, a Nigerian senator expressed surprise that military could not cope with Boko Haram. After all, he said, the military are given $10 bn a year. Even if they siphoned off 75%, they should have enough resources to defeat the terrorists.

Why the precipitous drop in law school applications and attendance?

The unemployment rate for lawyers nine months after graduation was 11.2% in 2013, up from 9.2% in 2011. Boston College Law School applications dropped 40% in five years, and Boston University’s were down 50%. Enrollment at the top 200 law school is down 24% from 2010. This is a lot even taking into account lawyer unemployment. (Boston Globe, May 4, G5)

At what age do we acquire wisdom?

On page 5 of the Weekend FT one finds the obituary of Stephen Sutton (1994-2014) who achieved fame in the UK by dying gracefully and publically at age 19. His Facebook and Twitter campaign raised £2.6 mn. (For what? The article does not say.) He is quoted as telling a group of wealth managers: "I do not know how long I've got left to live, but one of the reasons for that is because I haven't asked. That's because I don't see the point of measuring life in terms of time any more. I would rather measure it in terms of what I've actually achieved." Michel de Montaigne wrote something similar at a fairly young age, in his thirties: “Wherever your life ends, it is all there. The advantage of living is not measured by length, but by use; some men have lived long, and lived little; attend to it while you are in it. It lies in your will, not in the number of years, for you to have lived enough.”