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May 11, 2007, 9:43 am
Reading: Bonding Issues
Posted by David Gaffen
Justin Lahart says the stock market is controlled by the bond market these days. “The three biggest stumbles that the stock market has hit in recent years were connected to credit events,” he writes in today’s Ahead of the Tape column (Related) today’s Ahead of the Tape column . “In 2005, stocks fell when a General Motors bond trade went sour. They fell last year when rising interest rates in Japan sparked fears of tighter credit globally. And in March, stocks fell again when subprime-mortgage worries spilled over into the bond market.”
Writing in TheStreet.com, Mark DeCambre updates people on Eric Rosenfeld, co-founder of Long-Term Capital Management, and other hedge-fund managers who have serious disasters in their past. “Rosenfeld isn’t the only fund manager turning the scarlet letter of investment missteps into a badge of honor,” he writes (Related) . “And these days you don’t even have to wait a decade to get back in the game. ”
Tim Arango lays out in Fortune.com just how the $18.7 million deal for Roger Clemens will end up being worth it for the New York Yankees, assuming he’s worth six wins for this year (which isn’t guaranteed). “A 90-win team has just a 31% chance of going to the post season in the American League, while a 96-win team has an 81% shot,” he writes (Related) . “In other words, the deal elevated the Yankees’ chances of reaching the postseason this year by 50%. Still think the signing was irrational?”