Friday, August 17, 2007

Features of the week

Well, it's been a rough week for many in the markets, as the fellow in the picture can attest.

As we finish out the week this Friday, the Federal Reserve has lowered the discount rate by 50 basis points to 5.75% in an effort to ease liquidity and shore up the financial markets. So far, markets in Europe and the U.S. are rallying higher on the move.

Meanwhile, disaster has hardly limited itself to the world's financial markets. A bridge collapse in China, a Utah mining accident, deadly bombings in Iraq, and a powerful earthquake in Peru have left many dead and suffering in their wake.

Please take a moment to consider these tragedies and their effect on the victims' friends and families. If you are in a position to help someone far away or nearer to you, please do.

Having said all that, let's get started with our "Features of the week". There are many interesting articles and interview features ahead, so kick back and enjoy.

1. Fed cuts discount rate to 5.75%. A cut in the discount rate rather than the federal funds rate signals the Fed's belief that problems are mainly confined to the financial system, and have not yet hit the broader economy.

2. Exchange fever continues as Borse Dubai makes a rival bid for OMX. FT notes that the move will spark a "full takeover battle" with Nasdaq, which has offered $3.7 billion for the Nordic stock exchange operator.

3. Ratings agencies lose credibility after assigning AAA ratings to subprime-backed CDOs and other structured finance products, such as CPDOs.

4. Why can't hedge fund managers say they're sorry? WSJ's Gregory Zuckerman explains.

5. Hedge fund guy atones for subprime sins: Bloomberg's Mark Gilbert.

6. The U.S. should learn from the fall of Rome, warns David Walker, comptroller general of the U.S.

7. "10 Questions to Mohnish Pabrai". Value investor answers questions from GuruFocus readers.

8. Investor Marc Faber speaks with Howestreet.com about the current state of the markets and booms and bust cycles.

9. "Hitler's Handouts: Inside the Nazi's welfare state" - Reason Magazine.

10. Cartoonist Peter Bagge on, "The Right to Own a Bazooka".

11. Billionaire Eli Broad says recent hedge fund losses will affect art prices.

12. Could you live without China? Profile of a family's one year experiment in China-free living.

13. Structured finance discredited? CLSA's Christopher Wood on the unwinding of the credit bubble.

14. Do finance professors believe in market efficiency? CXO Advisory reviews a recent paper that examines this question and whether or not academics invest according to their beliefs.

15. Odd One Out. One of these economic forecasts does not belong - guess which one.

Fin! Thanks for reading Finance Trends Matter.