Bear Stearns verdict: E-mails lose cred

1

Goldman CEO says he does 'God's work'

2

Ft. Hood killer: Pre-traumatic stress disorder

3

What up, White House?

4

Ignoring Danger Signs, Press Trumpets Buffett's Good Bad News: 'We've Plateaued at the Bottom'

By Ward Harkavy in Bernanke, Featured, Press
Wednesday, Sep. 16 2009 @ 1:14PM

Warren Buffett put everyone's mind at ease, saying on CNBC and other outlets (including Fortune mag in the above video) that things are not going to get significantly worse and that we're "immeasurably better than we were a year ago."

Key word is "immeasurably." Once you start measuring, the situation is not quite so rosy — as Buffett also noted but as the media generally ignore. In the same breath as his "immeasurably better" line, Buffett said, "We're gonna have unusual losses in credit cards and in commercial real estate, all of that." "Unusual" meaning "horrendous."

Also on CNBC is Steve Liesman's "Fed Reviewing Banks' Commercial Real Estate Exposure," which is only mildly scary, and Andrew Abraham's jeremiad at The Market Oracle. Part of his rant:

I feel it is my responsibility not just to understand risks but warn investors when risk is unacceptably high. in my opinion the risks seem extremely high! The fact is that credit & debt have grown exponentially over the years. The next fact is that bank leverage is 50 times or more, how can this not be very high risk. The next fact is the unregulated derivatives that reach countless $ 1 trillion( AIG) with almost no counter party or no reserves against them.

There is one word: "RUN." The question is "run" where? What is safe? Are the banks safe with all the non performing residential mortgages? Or possibly upcoming commercial real estate problems... Or not to mention credit cards with no actual collateral other than a person's good credit at risk.

To the point right this second, especially in light of all the happy-face stories based on Bernanke's supposedly sunny news (it really wasn't all that sunny), Abraham also says:

My proverbial question is, Where were all the experts before the economic crisis hit? These "optimists," whether they are politicians, world bankers or speakers on CNBC/ Bloomberg, make their living based on good news and this is why they will continually tell you lies and never warn you about the risks.

Let Warren Buffett diplomatically refer to Henry Paulson, Tim Geithner, and Ben Bernanke as "heroes" — that was strictly for public consumption. Andrew Abraham's heroes are truthtellers — a short list including Nouriel Roubini, Jim Rogers (see my 2007 item on him), John Paulson, and "just a handful of others."