Chart of the Day – … Today’s chart illustrates how earnings declined over 92% since peaking in Q3 2007, which makes it easily the largest decline on record (the data goes back to 1936). … 
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As LIBOR declines, banks hoard more cash at the Fed - US Banks continue to hoard over $850 billion in cash at the Federal Reserve. … Out to 3 months the rate is almost the same as the overnight rate. It’s an indication of the spectacular rise in confidence banks have in each other and their own ability to fund themselves short-term. If you are a bank treasurer however, and you have a choice of depositing your excess cash with other banks or with the Fed at almost the same rate, your preference would be to park the money with the Fed. … – Sober Look Blog

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The Demise of the Construction Industry – Local Building Market Intelligence™ –
Construction in some really big markets has died, but we found a number of surprises when we decided to rank the Top 20 markets compared to the national peak in 2005.
Our takeaways:
A Sliver of its Former Self
Same As It Ever Was, except in Florida
Texas Remains Tops in Good Times and Bad
- John Burns Real Estate Consulting

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Taking a Chance on Risk, Again – By ANDREW ROSS SORKIN – Is there more or less risk on Wall Street today? If “greed is good” was Wall Street’s unofficial motto of the 1980s, the mantra these days might be “risk is bad.” It’s a calming phrase after a frightening year — but it glosses over several important ideas that make the Street run. – NY Times
Deal Book

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Market Insight: Can the rally end the crisis? – By Lena Komileva – A flurry of M&A news and corporate issuance on the first anniversary of Lehman Brothers’ bankruptcy has strengthened optimism about credit quality in the capital markets … With the MSCI World equities index gaining more than 60 per cent since March and corporate bond and structured credit risk spreads narrowing by a similarly impressive margin, this begs the question: can the capital markets recovery of 2009 end the liquidity crisis in the real economy? – FT.com

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The Oil Crisis Slamming Mexico – By Geri Smith – Sharply dropping Pemex revenues are widening the budget deficit, and Mexico can’t boost oil output fast enough – BusinessWeek

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The market’s expectation of a rate hike keeps getting delayed - … But the market doesn’t believe the Fed is going to raise rates any time soon. The Fed Funds futures, the market’s bet on where overnight rates will be in the future, are forecasting a rate increase that’s increasingly further away … – Sober Look Blog

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Affluent Online Shoppers in Retreat - More than half of affluent online buyers say they are worse off than a year ago. Excerpts from “Affluent Online Buyers Are Negatively Affected By The Down Economy” by Forrester Research – Research Recap

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MBS quick primer – DECONSTRUCTED – MORTGAGE-BACKED SECURITIES – Poof! How Home Loans Transform – By ALAN FEUER – NY Times