TIC

TIC report for December 2009

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The TIC reports has some damning news on Foreigners dumping U.S. Treasuries, especially China.

Firstly, what is the TIC? TIC stands for Treasury International Capital Data and it is a monthly report on who has bought and sold all stocks and bonds coming in and out of the country.

From the FAQ:

The Treasury International Capital (TIC) reporting system collects data for the United States on cross-border portfolio investment flows and positions between U.S. residents (including U.S.-based branches of firms headquartered in other countries) and foreign residents (including offshore branches of U.S. firms)

From this month's press release:

Systemic Risk Insurance? How about don't let banks drive drunk!

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In a paper The "Surprising" Origin and Nature of Financial Crisis: A Macro Economic Policy Proposal (obnoxious PDF big brother - be wary of this link, these bastards have this paper loaded with copy protections as well as image beacons, pretty stupid if it's supposedly a public document!)

The paper first identifies one of the main causes of the financial crisis as aggregate risk in systemically important financial institutions. Bloggerspeak translation: Derivatives, all of those asset backed securities, CDOs, and so on, which were put together like a house of cards, designed on faulty models and slapped with AAA credit ratings when they should not have been.