* Fund manager John Hussman, taking aim at inflated profit projections and hyped-up stock price forecasts on Wall Street, contends earnings are going to the dogs.
Think of it this way. Suppose your poodle is 40% overweight. Someone sells you a scale where every pound shown on the dial represents 1.4 pounds of actual weight. Guess what? Your poodle will step on that scale, and the dial will pleasantly report that your dog is at its ideal weight. That may be comforting if you don’t like to face reality, but the truth is, you’ve still got one sick puppy.
*Derivatives expert Satyajit Das douses Europe’s bailout plan with cold water. He says the European Financial Stability Facility “is primarily a debt shuffling exercise which may be self defeating and unworkable.”
Possibly undermining an otherwise compelling argument, he inexplicably abbreviates the facility as “ESSF.”
* Edward Chancellor of GMO wrestles with the implications of the sovereign debt crisis, but doesn’t quite manage to pin them down. “The future performance of sovereign credits depends on future events and decisions that are unknowable,” he asserts. You don’t say.
* What’s the right size for the Fed’s balance sheet? David Kotok takes an international perspective.
* Are taxes killing the Knicks? Discuss.